12.06.2021 – 01:00
New Osnabrück Newspaper
Osnabrück (ots)
Managing Director Schmidt: We urgently need a psychological kick to get the economy out of crisis mode – companies should be able to offset current losses with profits from previous years
Hanover. Volker Schmidt, chief executive of the employers’ associations in the House of Industry, calls on politicians to support companies and businesses in Lower Saxony “consistently and sustainably” and, above all, to relieve them through tax policy measures. “Particularly in the crisis, energetic tax policy signals for more investments are needed to show that things will continue after the downturn,” emphasized Schmidt, who spoke on Monday in a hearing in front of the state parliament’s Corona Committee, in advance of the “Neue Osnabrücker Newspaper “(NOZ).
It must now be a matter of bringing the German economy back to pre-crisis levels. “We now urgently need the three P’s: solutions appropriate to the problem, precise measures and the psychological kick to get the economy out of crisis mode,” explained Schmidt. Above all, one must move away from the idea of ”distributing state support according to the watering can principle”. The numerous problems surrounding the promised economic aid had shown that well-intentioned is often far from well-done. “Instead of great relief, November, December and bridging aid brought more bureaucracy on both sides,” criticized the employer representative.
In order to reduce the tax burden on companies, Schmidt, in his own words, relies on “the expansion of the tax loss carry-back, which is called for by many well-known economists”. The instrument of loss carry-back enables companies to offset current losses against profits from previous years – and thereby get money back from the tax office. That has several advantages. The companies received money promptly and were liquid – unlike with economic aid, “which must first be applied for and then go through a bureaucratic process that lasts for months until it is even cleared whether and – if so – in what amount there is money,” said Schmidt to consider.
On the other hand, it is primarily companies that have benefited from the regulation that have recently been successful and have achieved solid results. Only those who have already taxed profits in the pre-crisis years will benefit from the loss carry-back. There is a consensus among economists that the losses in 2020 and 2021 must be offset against the tax liability in 2019, 2018 and 2017. “That would be quick, immediate pacemaker help without the mills of the application bureaucracy and additional approval authorities,” said Schmidt. Losses can currently only be carried back until 2019.
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Original content from: Neue Osnabrücker Zeitung, transmitted by news aktuell
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