Majority of Family Businesses in Germany Won't Pay €1,000 Tax-Free Bonus to Employees

Newsworm
Newsworm
with
AFP
May 7, 2026
A majority of Germany's medium-sized family businesses will not provide the tax-free relief bonus of up to €1,000 for employees, according to a new survey by the Association of Family Businesses. The survey reveals 57% plan to refuse payment, 31% will pay only partially, and just 12% will pay the full amount. Business leaders cite years of recession and mounting economic pressures.
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Majority of Family Businesses in Germany Won't Pay €1,000 Tax-Free Bonus to Employees
The majority of medium-sized family businesses will not pay their employees the tax-free relief bonus of up to €1,000. This is according to a recent survey by the Association of Family Businesses. - AFP

The majority of medium-sized family businesses in Germany will not pay the tax-free relief premium of up to €1000 to their employees. This emerges from a current survey by the Association of Family Businesses, which was made available to the Rheinische Post (Thursday edition).

Economic Challenges Prevent Premium Payment

"According to our current survey, 57 percent of entrepreneurs do not want to pay the premium, 31 percent only partially, and only 12 percent will pay it," said the association's president, Marie-Christine Ostermann, to the newspaper.

Many entrepreneurs simply cannot afford the premium after several years of recession, Ostermann explained. The federal government speaks of relief but passes the costs onto businesses. "And this during the longest economic crisis since World War II."

Call for Technology-Neutral Energy Policy

Regarding the reduction of high energy costs, Ostermann called for a completely technology-neutral policy that could also enable the construction of small nuclear power plants. "It cannot be that after 30 years, for example, the solar industry is still being subsidized," she said. "We expressly support Economics Minister Reiche in ending this subsidy addiction." The Association of Family Businesses is also in favor of ending the ban on nuclear power, Ostermann declared.

Parliamentary Approval and Extended Timeline

The Bundestag voted in April to allow companies to pay their employees a premium of €1000 tax and levy-free in light of the current energy crisis. This will be possible until June 30, 2027, extended from the original 2026 deadline

The background to this extended deadline, following the initial proposal, is criticism from many employers who do not see themselves able to pay the premium in the short term given the currently difficult economic situation. The measure still needs to be approved by the Bundesrat, which will vote on it on May 8.

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