by Ilse Romahn
(21.02.2023) This year’s trade tax survey by the Frankfurt am Main Chamber of Industry and Commerce shows that the municipalities are a long way from lowering the trade tax rates. Two municipalities are registering increases in the assessment rates for trade tax and property tax A. Three municipalities are raising property tax B significantly.
Trade tax is becoming more expensive for companies in Friedrichsdorf (400 percent) and Steinbach (395 percent). While Steinbach raises 15 percentage points, in Friedrichsdorf it is even 43 percentage points. This means that Steinbach and Friedrichsdorf are catching up with the front runners in terms of trade tax in the Chamber of Industry and Commerce district. After Frankfurt (460 percent), Oberursel (410 percent), Friedrichsdorf (400 percent) follow Steinbach and Flörsheim (395 percent each) and Wehrheim (388 percent). As in the past, the rate is lowest in Eschborn at 330 percent.
In recent years, the tax burden on companies in the IHK district of Frankfurt am Main (City of Frankfurt, Hochtaunus and Main-Taunus districts) has increased significantly. The average trade tax rate in the IHK district has risen from 314 percent in 2010 to 375 percent in 2023.
Steinbach is one of two municipalities that are increasing property tax A and property tax B in addition to trade tax. The assessment rate for property tax will increase from 700 percent to 900 percent. In Friedrichsdorf, property tax A and property tax B rise to 595 percent. Oberursel again raises property tax B to 947 percent, thereby consolidating its position as the front runner.
The rate is also lowest here in Eschborn at 140 percent. Property tax B, which is levied on all properties with the exception of agricultural and forestry areas, is a burden not only for companies but also for homeowners and tenants.
“With the increases in property tax, the municipalities are contributing to a further increase in costs on the rental market, especially on the rental apartment market. For companies, this means a serious locational disadvantage in the competition for urgently needed specialists,” warns Ulrich Caspar, President of the IHK Frankfurt am Main.
As in previous years, the local authorities mainly justify the increases or the sometimes very high multiplier rates with the fact that they are necessary for a balanced budget and thus a strengthening of self-government.
None of the 25 municipalities in the district of the IHK Frankfurt am Main are planning a reduction in the trade tax or property tax rate for 2023. This would be a clear signal to the companies. Because high assessment rates worsen the location conditions in the municipalities concerned, hinder company settlements and encourage emigration. Ultimately, this would not serve the municipalities well. For years, the IHK Frankfurt am Main has therefore been calling for tax reduction potential to be used more consistently in order to relieve the burden on companies in the IHK district in the long term.
You can find an overview of all trade tax rates in the IHK district of Frankfurt am Main at: https://www.frankfurt-main.ihk.de/recht/uebersicht-alle-rechtsthemen/steuerrecht/gewerbe-und-grundsteuer/realsteuerhebesaetze-5195618
