The Federal Government adopted the Federal Ministry of Finance’s Growth Opportunities Act at the end of August 2023. It is expected to come into effect in 2024. It is part of the so-called 10-point plan and provides the German economy with seven billion euros annually until 2028. The total amount of relief is expected to be over 32 billion euros. In addition to various reforms and simplifications in tax law, the main objectives are: Mittelstand and climate-friendly investments this is followed by. Consequently, the approximately 300-page legal text begins in Article 1 with the “Act on Tax Incentives for Investments in Climate Protection (Climate Protection Investment Premium Act – KlimaInvPG)”.“
32-billion funding package for the economy
In 15 sections, Article 1 of the Growth Opportunities Act stipulates that energy efficiency measures in companies are to be supported by a profit-independent investment premium of 15 %. In general, investments are eligible for funding if they enable companies to reduce their energy consumption or implement energy efficiency measures. Eligible investments must be incorporated into an energy or environmental management system (ISO 50001 / EMAS) or in an energy audit according to DIN EN 16247 be included. They must be certified as particularly energy-efficient by an independent energy consultant. Applications must also include a comprehensive energy-saving plan. Applications may be submitted from 2024 through December 31, 2029. During this period, a maximum of 200 million euros may be submitted as the assessment basis, of which 15% will then be covered. In total, a company may submit a maximum of four applications by 2030, with the smallest measure starting at an assessment basis of 5,000 euros.
Growth Opportunities Act promotes SMEs
In a press release regarding the 10-point plan, the federal government states: „The Growth Opportunities Act complements the tax support measures for small and medium-sized enterprises that have already been adopted, such as tax breaks for the installation of photovoltaic systems and storage units, as well as simplified depreciation rules for the construction industry to facilitate housing construction. These measures have led to a tax cut of seven billion euros per year.“ It further states, “This incentive, which applies to energy efficiency measures, improves business conditions by providing tax incentives for investments in clean and climate-friendly technologies.” The Growth Opportunities Act is also intended to provide additional tax incentives for more research, whereby material costs will also be subsidized in the future, and the tax base will be tripled. For SMEs in particular, the subsidy rate can even increase to 35% in individual cases.