Berlin's Tax Revenues Growing Apace with its Economy
Berlin Benefits from Above-Average Growth
According to the latest forecast by tax appraisers, Germany is likely to see nationwide growth rates of 1.6 to 1.8 percent. The national capital, however, seems poised to outperform the country as a whole. The IBB Investment Bank Berlin predicts a growth in tax revenues to the tune of 2.5 percent this year. Financial experts also believe that Berlin's job market will continue to see positive growth. They assume that another 50,000 jobs will be created this year alone.
Extra Revenues through Growing Tourist Trade and Events
Meanwhile, Berlin's inland revenue authorities have identified the continuous rise in the numbers of tourists as another source of expanding tax revenues. The so called “City Tax,” an accommodation tax on overnight stays in hotels that is levied in no other city, will probably flush more than 42 million euros into the city's coffers. Between now and 2020, accommodation tax revenues are expected to grow by 30 percent to a total of 54 million euros as the number of overnight stays by tourists keep climbing after a record high of 30 million euros in 2015. The first quarter of 2016 saw the visitor total in the city's hotels and hostels increase by another 8.1 percent year on year.
Major events like the fan mile during Euro 2016 will continue to generate tax receipts for the remainder of the year. In fact, football fans viewing the Euro 2016 will alone cause beer tax revenues to rise from 13.9 to 15 million euros. All of these aspects have prompted Berlin's Senator of Finance to project year-end revenues of 19.12 billion euros for 2016. His tax forecast for 2017 actually suggests 20.04 billion euros. Year on year, this would imply an extra income of 42 million euros this year and of 98 million euros next year. Berlin's inland revenue authorities view the trend as an important signal confirming the favourable performance outlook for Germany's first city.