At present, the German economy is depressed. To balance budgets and to avoid receiving slapped wrists from Brussels, there have been widespread cuts to privileges in German tax law. Such forceful measures have already put many businesses at risk. Additionally, turning the tax screw added another dimension to Germany’s international reputation as a high tax area.
However, with a corporation tax rate of 26.375% (including the solidarity surcharge, which was introduced to finance the reunification), German taxpayers are only loaded with an average tax burden when compared with other countries. Also, the tax base computation in Germany is quite often more liberal than in other tax jurisdictions.
