Second-Home Tax Boosts City Coffers in Saxony, Saxony-Anhalt, and Thuringia
Taxing secondary residences brings in substantial income for several major cities in these regions. Leipzig tops the list, collecting about 1.6 million euros annually, equating to 16% of the monthly net rent for secondary homes. Various cities including Magdeburg, Dresden, Erfurt, Plauen, Eisenach, and Chemnitz also levy secondary residence taxes.
City authorities have an incentive to increase their population, as state funding increases with every primary resident. Magdeburg, for example, charges 10% of the annual rent and has 1179 affected individuals, resulting in 434,000 euros of revenue in 2022. Suspecting the administrative burden was too high, Wernigerode and Zwickau chose not to introduce such a tax.
Erfurt, with approximately 500,000 euros in 2022, demonstrates one of the higher tax revenues. However, residents with secondary homes do not receive state allocations, despite utilizing public facilities like libraries and swimming pools. As a result, larger cities like Erfurt have chosen to implement secondary residence taxes.
Dresden's 2022 revenue reached around 1.3 million euros, Chemnitz earned 182,000 euros, Plauen around 60,000 euros, and Eisenach 47,000 euros. Cities often offer exemptions, such as for apartments used by independent organizations for therapeutic purposes or youth welfare.
In Eisenach, students and trainees with secondary residences are granted exemptions until they turn 27. Cities like Stendal, Wernigerode, and Dessau-Roßlau do not levy a secondary residence tax, choosing instead to incentivize main residences.
Points to Consider
- Cities with secondary residence taxes in Saxony still see a resident increase without enforcing the tax, which benefits them financially.
- Plauen generated 60,000 euros in secondary residence tax revenue in 2022, highlighting its significance in funding municipal services.
- A discussion among city officials in Wernigerode about implementing a secondary residence tax ultimately did not materialize due to administrative overheads.
- Magdeburg, one of Saxony-Anhalt's towns, records significant revenue from the secondary residence tax, amounting to about 434,000 euros in 2022.
- In Erfurt, residents with secondary homes utilize public facilities like pools and libraries, but do not receive state allocations, prompting cities to collect secondary residence taxes.
- Chemnitz, Dresden, and Leipzig are among the cities benefiting from secondary residence taxes in Saxony, with Chemnitz earning approximately 182,000 euros in 2022.
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