Automobiles and the economy: CSU boss proposes stimuli

by Thorsten Koch

The Bavarian Prime Minister Markus Söder (CSU) would like to consider the car industry when it comes to the economic package to be discussed from Tuesday. The “heart of our economy” should be promoted in view of expenditure in this area by other countries.

Thousands of jobs in Germany depended on the industry. A purchase premium is favorable to climate protection and to the economy, at the same time. In the years to come, consumers will replace conventional automobiles with “clean vehicles of the latest generation”. In addition to supporting demand, private charging stations could be supported by the state by up to 50 percent.

General strengthening of the economy

In addition to easing the burden on the automotive sector, Söder campaigns to stimulate the economy comprehensively, and to strengthen companies structurally. “We have to strengthen domestic demand to offset partly weaker exports,” said Söder, indicating that there is no way around tax cuts in one form or another. Should the solidarity surcharge be abolished, that would mean the greatest relief for taxpayers in more than 30 years, according to Söder.
The Prime Minister called a family bonus useful. He also mentioned, as options, degressive depreciation, improvements in the loss calculation, relief in energy costs and subsidies in the municipal area. Söder emphasized the imprtance of setting priorities, and to limit the funding program.

Different ideas as to the design of measures

The Federal Association of Industry (BDI) is demanding purchase premiums, too, but would like to include modern vehicles with efficient combustion engines in the funding, given that incentives for electromobility remained suffiently important. The mechanical engineering association VDMA, on the other hand, rejects a purchase premium for automobiles, as this would work selectively, would discriminate against other products and cause deadweight effects. The VDMA prefers relief via taxes and regarden the burden of duties.

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