Overview

• The Bundesrechnungshof report identifies annual revenue losses in the double-digit billions due to tax evasion, ineffective subsidies, and outdated tax collection systems.
• Recommendations include eliminating tax privileges like diesel subsidies and handwerkerleistungen, which could save up to €30 billion annually.
• The report calls for a fundamental overhaul of the reduced VAT rate, limiting it to basic necessities rather than luxury items, which could yield significant fiscal benefits.
• Improved tax enforcement, including modernized IT systems and enhanced auditing measures, is estimated to recover up to €70 billion in lost revenue from cash register manipulation and other issues.
• The report cautions against expanding tax concessions, urging transparency and preparation for businesses and citizens who may face reduced benefits or additional burdens.