The "boomer" generation is retiring – and this includes company directors. In 2024, the number of IHK advisory sessions with entrepreneurs who planned to close or transfer their business reached a record high. At the same time, the DIHK's Corporate Succession Report 2025 reveals that over a quarter of advised business owners are considering ceasing operations, often due to the lack of succession.

Tax uncertainties related to the generational transition pose a significant challenge for family businesses. At present, a complaint regarding the exemption rule for productively-tied business assets is pending before the German Constitutional Court.

Should this protection be curtailed or removed, "significant liquidity and financing pressures could arise, affecting investment and competitiveness, and ultimately putting jobs and regional value creation at risk," warns DIHK's Chief Executive Officer, Helena Melnikov. "Given the substantial burdens that may result from company valuations, tax rates, and lack of liquidity, the exemption of business assets must remain a cornerstone of inheritance tax law."

"It's not about luxury goods, but about industrial sites, factory halls, machines, or lorries that people use to generate the prosperity of our country."

According to the DIHK, the current concept has proven effective. Tax benefits for business assets are tied to explicit conditions, such as continuing the business and safeguarding employment. Still, reforms and more practical solutions are necessary.

The guiding principle must be simplification rather than tightening. This dossier illustrates how this is achievable.