Third Corona Tax Relief Act passed with three measures.

With three measures in tax law, the governing coalition wants to provide further tax relief and economic stimulus in the Corona crisis.

At the beginning of February, the Grand Coalition reached agreement in the Coalition Committee on further support measures in the Corona pandemic. The fiscal part of these decisions will be implemented with the Third Corona Tax Assistance Act, which the Bundestag and Bundesrat have already debated and passed. This provides for a total of three measures

• Gastronomy: The application of the reduced VAT rate of 7 % for restaurant and catering services (excluding the supply of beverages) is temporarily extended beyond June 30, 2021, until December 31, 2022.

• Child bonus: A child bonus of 150 euros will be granted for each child eligible for child benefit in 2021. To this end, the child benefit for the month of May 2021 will be increased by a one-off amount of 150 euros. Like the normal child benefit, the bonus is also offset against the child allowance, so it primarily affects families with lower incomes.

• Loss carryback: The tax loss carryback will be extended again for 2020 and 2021 and increased to EUR 10 million (EUR 20 million in the case of joint tax assessment). This also applies to the amount limits for the provisional loss carryback for 2020.