Germany to lower reporting thresholds for energy and electricity tax subsidies

• The German Federal Ministry of Finance has proposed a draft bill decreasing the thresholds for reporting certain energy and electricity tax subsidies.

• For the 2024 reporting period, the general threshold will be set at €100,000.

The German Federal Ministry of Finance proposed a draft bill on 5 October 2023 that would decrease the thresholds for reporting subsidies received in the area of energy and electricity taxation.1

Detailed discussion

The German Energy and Electricity Tax Law contains many measures qualifying as subsidies under European Union (EU) law. As a result, the EU keeps a close eye on which companies receive which subsidies. The German legislator has implemented a specific act, the Energiesteuer-und Stromsteuer-Transparenzverordnung (EnSTransV) containing details on transparency matters in the field of energy and electricity taxation.

Currently, the Act prescribes that beneficiaries of subsidies must notify or declare to the competent customs office individual benefits if the amount of the tax benefit for the calendar year in each case reaches €200,000 or more. These thresholds originate in transparency obligations put in place by the European Commission. As the Commission has decreased the transparency thresholds, the German Federal Ministry of Finance proposes to amend the EnSTransV to reflect the EU-wide thresholds.

Reporting for the calendar year 2023 must be submitted by 30 June 2024, at the latest. In exceptional cases, the proposed amendments to the reporting thresholds will affect the 2023 reporting already made. These exceptions include cases in which the subsidy was issued based on the Guidelines on State Aid for environmental protection and energy for 2014–2020 and 2022 issued by the European Commission. According to present information, this only concerns a few provisions, but it will be important for businesses to analyze whether they are affected by this provision.

Most of the subsidies that will need to be reported are based on the General Block Exemption Regulation (GBER).2 For the subsidies based on the GBER, the threshold is lowered for the 2024 reporting, which is due on 30 June 2025. Starting with the reporting period for 2024, the general threshold for reportable subsides is proposed to be lowered to €100,000. Even lower thresholds will apply to beneficiaries in fisheries and aquaculture and in the primary production of agricultural products. Furthermore, the draft bill would decrease thresholds for the publication of information on the internet.

Next steps

Based on underlying reductions of the reporting thresholds under EU law, it can be assumed that the regulation will be gazetted in 2023. Affected companies should be aware of the changes and adapt their reporting accordingly.

For additional information with respect to this Alert, please contact the following:

Ernst & Young GmbH Wirtschaftsprüfungsgesellschaft

• Richard J. Albert, Leipzig

• Ralf Reuter, Düsseldorf

• Florian S. Zawodsky, Berlin

Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor

For a full listing of contacts and email addresses, please click on the Tax News Update: Global Edition (GTNU) version of this Alert.