Germany needs skilled workers from abroad. The federal government now wants to attract them with tax reductions of up to 30 percent of gross wages. The proposed tax rebate is another effort to attract skilled workers to Germany.
To attract more and more skilled workers from non-EU countries, Germany plans to offer tax concessions in the future. In their negotiations on the 2025 federal budget, Chancellor Olaf Scholz (SPD), Economics Minister Robert Habeck (Greens), and Finance Minister Christian Lindner (FDP) also agreed on measures to combat the labor shortage, reports Der Spiegel.
The federal government’s so-called growth initiative provides that “newly immigrated skilled workers can exempt 30, 20, and 10 percent of their gross wages from tax in the first three years.” A lower and upper limit for the gross wage will be defined for this exemption. The effect of this measure will be examined after five years.
Labor Minister Hubertus Heil believes the key priorities should be removing bureaucratic obstacles, speeding up the visa process, and improving professional certification.
The tax exemption is to have a lower and an upper limit on gross wages. This is to prevent foreigners from being increasingly lured into the low-wage sector, but also to relieve the burden on highly paid skilled workers from abroad. However, details are reportedly still being finalized.
In addition, the bureaucratic hurdles for companies that want to hire foreign skilled workers are to be reduced. For example, the Western Balkans rule mentioned above is to be expanded, which makes visa regulations easier for workers from certain countries. Immigration into temporary employment is also to be made possible under clear criteria to protect against wage dumping. Foreign temporary workers are to be hired for at least twelve months.
Germany has in recent times, made many extraordinary efforts to attract more and more skilled workers, especially from non-EU countries. In three different rounds of immigration rule changes, the federal government introduced ease in skilled worker visas, student visas, and trainee visas. On the other hand, a complete new jobs search visa opportunity card has also been introduced on 1 July 2024. New citizenship laws have also been introduced on 27 June 2024 with reduced stay duration such as 5 years in Germany.