Germany Approves Automatic Kindergeld Plan While Budget Draft Seeks to Remove €25 Low‑Income Top‑Up

The reforms aim to simplify child‑benefit payments and raise rates even as the budget proposal would end a €25 Kinderzuschlag supplement with likely effects on other welfare spending.

Overview

The Bundestag passed a law on July 9, 2026 to introduce an antragsloses (automatic) Kindergeld system with formal changes due to take effect from January 1, 2027 pending Bundesrat input and final parliamentary steps.
Automatic payments will roll out in two stages in 2027, first from about March for newborns whose parents already receive Kindergeld and then from about November for first‑time parents who meet residency, IBAN and work conditions.
A Bundesfinanzministerium document models a stepwise rise in Kindergeld from €259 toward €272 per month by 2028 and estimates up to €600 per year in tax relief for two‑earner families starting in 2027.
The Bundeskabinett approved a 2027 budget draft on July 6, 2026 that proposes abolishing the €25 Sofortzuschlag in the Kinderzuschlag from January 1, 2027, a change projected to save about €450 million but raise SGB II spending by roughly €150 million and cut Wohngeld costs by about €40 million.
Families will face mixed effects: many will benefit from simpler claims processing and modest increases, while some low‑income households could lose up to €50 a month per two children and may need to seek supplementary basic security through jobcenters depending on the final law and administrative rules.