The financial equalisation between financially better and worse-off provinces has risen to a new record value: 11,45 billion Euro were redistributed to 2018 between countries – in the previous year, there were approximately 11.2 billion euros.

Bayern were the shoulders of the total, more than half of The Bavarian payments rose to 785 million to 6.67 billion euros. Other payer countries were Baden-Württemberg, Hessen and Hamburg. The greatest beneficiary of Berlin was 4.4 billion euros. The provisional Figures of the Federal Ministry of Finance, on Monday first, the “Handelsblatt” reported.

After Bayern paid Baden-Württemberg with nearly € 3.1 billion the most in the distribution pot, Hesse follows with 1.6 billion Euro, Hamburg was still around 83 million euros. After Berlin and Saxony (1.1 billion euros), North Rhine-were-Westphalia (1.01 billion euros), lower Saxony (around 830 million euros) and Bremen large receiver (about 740 million euros). The financial equalisation regulates the distribution of revenues between the Federal government, the länder and the municipalities.

Each of the 16 Federal States has due to its economic, geographic, and regional characteristics, different levels of income. The main aim of the financial compensation, the “uniformity of living conditions is, according to the basic law”. Financial equalization between the länder is to be replaced by 2024 in its present Form by a System to compensate for the VAT imbalances.

The countries share is to be distributed according to the number of inhabitants, modified by increases and reductions depending on their financial strength. In addition, the Federal “poorer” countries, goes under the arms, with the first year EUR 9.75 billion. The Federal government receives, in turn, more intervention rights – for example, in the case of highways, the tax administration, investment in schools and Online-Offered by the administration.



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