Shortfalls in corporate tax collection could mean that Germany's ability to adhere to its commitments under the EU's Stability and Growth Pact is compromised, according to a report in Handelsblatt on Wednesday.
'Given the current global economic uncertainties, it's no longer possible (for the German government) to keep the budget deficit within 3% of gross domestic product,' Klaus Zimmerman, head of economic research institute, DIW explained to the newspaper.
The report revealed that in the first half of this year, total refunds of corporate taxes exceeded revenues by some 1.3 billion euros, and that in June - traditionally an important month for advance tax payments - revenue was down 76.3% on the same period in 2001.
Speaking to Handelsblatt on Wednesday, Barbara Hendricks, Parliamentary State Secretary to the Finance Ministry also suggested that the number of unused tax credits (built up before tax reforms were introduced in 2000, and redeemable over a 15 year period) could cut the country's corporate tax revenue by up to 25.5 billion euros this year.
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