Halle worried: Crafts warn of 36% property tax increase!

Halle worried: Crafts warn of 36% property tax increase!

There is currently great unrest among craft businesses in the Halle chamber district. The fear of increasing tax burdens is taking concrete shape, particularly with the threat of an increase in property tax B for residential and commercial properties by a whopping 36 percent. This would raise the new assessment rate to 680 and thus catapult it above the level of comparable cities such as Leipzig (assessment rate 450). Lothar Dieringer, an entrepreneur from Halle, expresses serious concerns about the financial burden on businesses and employees. He makes it clear that the tax burden in Halle is now even higher than in many EU countries. This could make the city less attractive for start-ups and companies wanting to relocate there.

In view of this development, Dieringer suggests taking a closer look at spending and considering savings instead of immediately deciding on tax increases. This could help avoid companies leaving for cost reasons. “There is something there,” says Dieringer, and appeals to those responsible to act with foresight and not just chase short-term income without taking the long-term consequences into account.

Property tax reform and its consequences

From January 1, 2025, the new property tax will be levied by municipalities as part of the property tax reform. This is the result of a ruling by the Federal Constitutional Court, which declared the 1964 uniform assessment to be unconstitutional. The legislature sees itself as having a duty to create a regulation that conforms to the constitution. However, the implementation of the reform shows that there is no uniform nationwide solution: some federal states use the federal model, while others have passed their own laws. Easy calculation by municipalities remains another concern that interests many citizens.

In North Rhine-Westphalia, which also includes Halle, citizens must therefore prepare for the application of the federal model, where differentiated assessment rates can be applied. At this point, it is also important to know that property tax values ​​are reassessed every seven years, which could further change the tax burden. The new sentence will certainly have an impact on communication between municipalities and companies in the future.

Country-specific differences

So regionality plays a big role. There are different models for calculating property tax in the different federal states. These differences are of interest not only to citizens, but also to companies planning to establish themselves in one of the regions. While an area-based model is used in Bavaria, the municipalities in Baden-Württemberg, for example, determine property tax using standard land values. It is also important for Spain that the assessment rate in Brandenburg is used in comparison to the federal model and has even been reduced to 470 in Berlin.

The property tax reform may at first glance bring the necessary openness to changes in the municipalities, but the uncertainty about the specific tax burden and its impact on the economy will certainly trigger many discussions and arguments in Halle. The next period could be crucial for local companies as to whether they develop in an attractive location or fall victim to migration for cost reasons.

Many hope that those responsible in the city of Halle will take the signals from the local economy seriously and find alternative solutions to increasing taxes. The creation of a climate- and business-friendly environment should be a priority for everyone involved. It is crucial for companies that Halle remains a place where they can be economically successful.

Further details on property tax reform and state-specific models can be found on the websites of Haufe and DMHS be read.

The coming months will show how the city of Halle deals with this challenge and what course is set for the future development of the region.