Budget plans on the brink? FDP announces veto against heavy burden on farmers

Farmers' demonstration in Berlin - Budget plans on the brink? FDP announces veto against heavy burden on farmers

Farmers want to mobilize in Berlin this Monday to protest against the planned abolition of tax breaks by the coalition government. Under the motto "Too much is too much", a rally is planned for 11 a.m. at the Brandenburg Gate. Federal Agriculture Minister Cem Özdemir (Greens) is also expected to speak. The German Farmers' Association is demanding that the government withdraw its plans to abolish regulations on agricultural diesel and vehicle tax exemptions in order to save money in the federal budget. According to the association, numerous tractors will also roll into the capital in protest.

The farmers' association has also called for the demonstration nationwide via its state farmers' associations. Farmers' President Joachim Rukwied and other industry representatives want to make their displeasure at the plans clear at the rally. "We farmers will send a first clear signal to the coalition with the traffic light system on Monday," Rukwied told the German Press Agency. The proposals on agricultural diesel and vehicle tax must be completely withdrawn. "If not, there will be massive resistance from January. We will not put up with this," emphasized the farmers' president.

According to the association, agriculture would be deprived of almost one billion euros. Up to now, farms have been able to get a partial refund of the energy tax on diesel. In addition, agricultural and forestry vehicles are exempt from vehicle tax.

Farmers' demonstration in Berlin: FDP announces veto against heavy burden on farmers

The FDP parliamentary group in the Bundestag announced on Sunday that it would veto the plans of the "traffic light" leaders to abolish tax breaks for farmers. "The FDP parliamentary group considers the heavy burden on agricultural businesses to be unacceptable," FDP parliamentary group leader Christian Dürr told the German Press Agency in Berlin. He added: "There is too often talk of allegedly climate-damaging subsidies without looking at the social and economic consequences of abolishing them."

"Above all, our farmers need fair competitive conditions in a European comparison," Dürr demanded. "This is precisely what would be jeopardized if the plans were implemented." Finance Minister Christian Lindner has "therefore already promised that he can present alternatives to the government if the coalition partners agree". The FDP leader told Redaktionsnetzwerk Deutschland: "To be clear, I am not a friend of the burden on agricultural businesses." That is why the government and coalition will have to talk to each other. "I am open to alternatives," he emphasized.

Vice-Chancellor Robert Habeck (Greens) defended the "traffic light" plans in the agricultural sector. At the same time, he defended his party colleague Özdemir. "The Federal Chancellor, the Finance Minister and I had to make the decision on the agricultural diesel subsidy as part of an overall solution," Habeck told dpa. "That was not easy and I am also aware of the hardships. The Minister of Agriculture has warned against scrapping the agricultural diesel subsidy. Cem Özdemir knows the situation of farmers and the burden and has made this very clear." Habeck said that he had also discussed these arguments with the government partners. "But as a result of the ruling by the Federal Constitutional Court, we have to make do with less money and restrict spending. And the three of us made this decision as part of the overall package."

CDU fires back against Ampel savings plans

Following lengthy negotiations with Chancellor Olaf Scholz (SPD) and Finance Minister Christian Lindner (FDP), Habeck agreed on Wednesday on how to plug billions of euros in the federal budget for 2024 and in the climate and transformation fund following a ruling by the Federal Constitutional Court. This also includes the plans for cuts in the agricultural sector.

CDU leader Friedrich Merz wrote in an email to his supporters that, on average, "every agricultural business will be burdened with 4,000 euros in additional taxes per year" as a result of the traffic light plans. The federal government does not want to make savings, but is primarily looking for new sources of income. Yet the FDP had "promised not to increase taxes". The CDU/CSU will "work very hard to ensure that these tax increases do not happen", announced the CDU/CSU parliamentary group leader.

According to industry figures, the earnings situation in agriculture has recently improved. In the 2022/23 financial year, which ended in June, the average profit of farms rose to a record level of 115,400 euros - an increase of 45% compared to the previous year. However, in view of falling prices for grain, oilseeds and milk, the farmers' association had already expressed pessimism about future business prospects before the traffic light plans were announced.

A large demonstration with thousands of farmers from all over Germany and a long convoy of tractors also took place in front of the Brandenburg Gate at the end of 2019. At that time, farmers took part in nationwide campaigns to demand a greater say in new environmental and animal welfare regulations and more appreciation for their industry.