Cabinet decides on a supplementary budget: record debt | politics

"Now again spat in the hands," announces the Minister of Finance Scholz. The Federal government wants to stimulate the economy again. For loans in a height th

Cabinet decides on a supplementary budget: record debt | politics

"Now again spat in the hands," announces the Minister of Finance Scholz. The Federal government wants to stimulate the economy again. For loans in a height that makes some people dizzy.

Berlin (dpa) - The German government has paved the way for record-high debt, due to the Corona-crisis. The Cabinet has made this Wednesday a second supplementary budget of 62.5 billion Euro.

So for the current year, planned new borrowing rises to 218,5 billion euros. With the money, especially the stimulus package is to be funded, this should help boost consumption and the economy in the coming months.

"Now, we will give Germany a huge boost for our future," said Finance Minister Olaf Scholz (SPD). The Federal government will take a lot of money in the Hand, "because doing nothing would aggravate the crisis and would be so much more expensive". This show of strength was to lift therefore, because the Federal Republic of Germany have reduced in good times, before debt.

The debt ratio will now increase from under 60 to about 77 percent, said the Vice-Chancellor. At the same time, he pointed out that others had been before the pandemic, more debt relative to economic output, as Germany after the crisis will have. The debt is to be reduced from 2023 within 20 years. The Bundestag must agree to the additional credits, however.

had adopted A first supplementary budget of more than 156 billion euros, the Parliament already at the end of March for the funding of a series of auxiliary packages and also the debt brake in the basic law exposed. Now to be reduced, among other things, the VAT temporarily, and a Bonus for families with children paid. In addition, small and medium-sized companies because of the crisis, particularly high declines in sales can get, Bridging loans of a total of 25 billion euros. The Federation and the Länder to balance the trade tax losses in the municipalities. The Federal government also assumes in the future, significantly more cost of accommodation for job seekers from the local communities.

included in the new draft budget, the latest tax estimate. Meanwhile, the Federal government assumes that, due to the Corona-crisis around 40.5 billion euros in taxes are less pure, as to be thought the beginning of the year.

The Dimension of the debt is in comparison with the financial crisis: In the previous record debt year 2010 the Federal government took in 44 billion euros in new loans. FDP-householder Otto Fricke holds the now-scheduled debt is unnecessary high. Scholz to take more loans and Park the money in the budget, so he will need in the election year 2021, no new debt, he criticized. "The bag of tricks of a Finance Minister who would like to move into the Chancellery of the game."

left party Deputy, Fabio De Masi, in contrast, advocated "massive government spending". The redemption is not "must be 50 years stretched, to take the economy on a strict diet to much air". Also Green-householder Sven-Christian Kindler, a long-term future perspective is missing in the supplementary budget. In the short term, the Federal government suggest a number of useful measures, the investments leave it, but a dangerous gap. "We need investment and a decade of the future and long-term funding commitments for it", called Kindler.

Updated Date: 18 June 2020, 17:35

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