17/11/2025 - “Germany as a business location is under pressure: shortcomings in infrastructure, excessive regulation, excessive bureaucracy, slow digitalisation and one of the world’s highest corporate tax burdens. There are a number of ‘home-grown’ problems that are putting the competitiveness of our companies and thus growth under strain. Trade tax is a German peculiarity, as such a regional burden on companies in addition to corporate and income tax exists only here,” explains Melnikov. Approaches to reform have been discussed for years, but not tackled, because municipalities are not willing to do so – but also because municipalities are not supported by their states. “Indeed, the states are primarily responsible here, as they bear the responsibility for ensuring adequate financial resources for the municipalities,” Melnikov said. 

According to DIHK's assessment, municipalities are increasingly struggling to balance their budgets and are raising trade tax rates to increase their revenues. “But this works only to a limited extent, because companies are already heavily burdened and avoid the increasing burden by relocating. If things go badly for Germany, relocations of sites or productions beyond Germany's borders take place. This is also confirmed by the latest economic survey of the DIHK. This development must urgently be stopped. All levels are called upon here, but particularly the states, where the development of tax revenues has actually been positive in recent years,” said the DIHK Chief Executive. 

The results in brief: In 2025, the average weighted trade tax collection rate for the 716 municipalities with more than 20,000 inhabitants nationwide will increase from 437 to 438 %.  

In 2025, nine percent of municipalities – six percentage points less than in 2024 – increased their trade tax rate. The number of municipalities reducing their rate continues to decline every year. This year, only four small municipalities reduced their rate. Regional differences in trade tax rates remain high. The regional focus of high tax municipalities remains unchanged in the west: apart from Seelze (Lower Saxony, 500 %), the “TOP-50” municipalities for trade tax rates are all in North Rhine-Westphalia and are led by Oberhausen and Mülheim (580 %), Erftstadt and Waldbröl (565 % each), closely followed by Elsdorf (555 %), Overath and Alfter (550 % each). 

One example of the regional differences: A medium-sized corporation with annual profits of EUR 2 million (and approximately 200 employees) will have to pay an average of EUR 30,000 more per year in trade tax in North Rhine-Westphalia in 2025 than its counterpart in Lower Saxony or even almost EUR 52,000 more than its competitor in Baden-Württemberg. 

Here are the full results of the apportionment survey. (only available in German)