Changes that happened in Germany in July 2023
Germany is a nation that is always changing, and July 2023 will be no different. This month, significant changes in the nation will impact various aspects, including work dynamics and tax payment methods. The month of July 2023 begins in Germany with a rush of significant events and noteworthy advancements in a variety of fields. The purpose of this article is to explain the fundamental developments and changes that happened in Germany in July 2023. Germany has had a dynamic terrain characterized by progression and change, from political milestones to economic changes and cultural advancements.
1) Summer Holidays
School break windows vary by state in each of Germany’s 16 states and stop and start at various times. However, starting on July 28 when Bavaria becomes the last state to begin its school-free vacation, all students in Germany can spend their holidays together for exactly one week.
Most other German states begin their summer vacations in July: On June 22nd, Schulferien began in North Rhine-Westphalia. On July 6, Saxony-Anhalt, Bremen, and Lower Saxony send their kids off on vacation; on July 10, Thuringia and Saxony take turns.
The start of the summer break is July 13 in Hamburg, Berlin, and Brandenburg. The holiday season begins on July 17 in Schleswig-Holstein and Mecklenburg-Western Pomerania and on July 24 in Hesse, Rhineland-Palatinate, and Saarland. In Baden-Württemberg, summer vacation continues until July 27.
2) Improved Bürgergeld Benefits
Germany is making adjustments to the Bürgergeld, the replacement for the Harz IV unemployment payments system. Low-skilled workers will receive vocational training assistance to access the skilled labor market, replacing job placements as a means of providing access. Additionally, the income exemption limit will be raised, enabling individuals earning €520-€1,000 per month to have a 30% tax-free income, up from the current 20%.
Moreover, young individuals can expect an increase in available funds. They will have the opportunity to earn income up to €520 through school, student work, vocational training, or pocket money from federal voluntary services or voluntary social years (FSJ). Students who work during vacations can retain their entire earnings. Additionally, volunteers are eligible for an annual expense reimbursement of up to €3,000.
3) Higher contributions for care, especially for people without children
Under the Long-Term Care Support and Relief Act (PEUG), the general contribution rate for long-term care insurance (Pflegeversicherung) will rise from 3.05 percent to 3.4 percent of gross income. This increase will be split equally between employees and companies. Additionally, individuals without children will face an additional tax, which will increase from 0.35 to 0.6 percentage points. The estimated revenue from this tax hike is approximately €6.6 billion annually for the German government. Generally, this group will be required to contribute 2.3 percent of their gross income. Conversely, individuals with multiple children will experience a reduced impact. For each additional child between the second and fifth, their regular contribution will decrease by 0.25 percentage points until the child reaches 25 years of age.
4) More money will be given to pensioners
Beginning on July 1st, the roughly 21 million German pensioners will receive more money: Pension increases will be 4.39 percent in the west and 5.86 percent in the east. This implies that a standard pension amount will be used going forward throughout Germany. The pension increases will cost an average person with 45 years of contributions about €71 more per month in the west and €93 more in the east of the country.
5) The simplified access to Kurzarbeit has ended.
German Health Minister Karl Lauterbach pronounced the Covid-19 outbreak to be over in April. In accordance with his proclamation, the normal procedures for requesting Kurzarbeit (short-time allowance) will resume as of July 2023. Employees having a reduced workload—due to, say, a weak economy—can nevertheless keep their positions and a portion of their pay under the scheme. Starting in July, companies must have at least one-third of employees experiencing a pay loss of over 10% to be eligible for the wage-replacement benefit (previously 10%).
6) Increasing shipping costs
From July 1st, some DHL delivery service users may face higher costs. The postage for a 10-kilogram package will increase from €9.49 to €10.49. Bulky goods and other services like cash on delivery will also cost more.
7) Tax on gas storage
On July 1st, the gas storage charge will increase from the current 59 cents per megawatt hour to €1.45 per megawatt hour (0.145 cents per kilowatt hour). This will result in higher expenses of about €18 per year for a single-family home with a 20,000 KWh annual consumption.
8) The ‘Maestro’ function will soon be stopped
German giro cards will no longer support the Maestro feature in the future. Customers had no issues using this card to make payments or withdraw cash abroad until recently. The Giro card remains fully functional in Germany, allowing normal payments and cash withdrawals, even without the Maestro feature. Customers can acquire a Giro card for domestic use and a separate debit or credit card for international transactions, permitted by various institutions. The German Banking Industry claims that banks and savings institutions are currently selecting new partners for use abroad.
9) E-prescriptions will soon be accessible
Starting July, individuals with statutory health insurance can use their insurance cards at pharmacies for accessing e-prescriptions. Germany’s Health Ministry policy removes the need for patients to visit the doctor’s office for paper prescriptions. Eighty percent of pharmacies are anticipated to be linked to the new system by the end of July. However, if a customer requests one, they can still get a traditional paper receipt.
10) Safeguard to whistleblowers
Beginning on July 2, Germany will safeguard whistleblowers who expose wrongdoing in public institutions and businesses against dismissal and abuse. Authorities and businesses need to establish contact points for reporting fraud, corruption, and violations of laws related to animal care and environmental protection.
In July 2023, Germany witnessed significant changes across various aspects. Staying informed about these developments is crucial for making appropriate plans. Whether living or visiting Germany, it’s crucial to be familiar with the latest rules and laws to stay informed. The transformative month highlighted Germany’s resilience and adaptability across politics, economy, social initiatives, technology, and cultural events, signifying its remarkable progress. Germany’s future looks bright, embracing progress, sustainability, and diversity, benefiting its residents and the global community alike. Stay updated to be part of this bright future.
Read more at How To Abroad:
Youth Kulturepass in Germany: Everything you Need to Know
Inflation in Germany 2023: Everything you Need to Know
Want to study in Germany? How To Abroad can help you achieve your academic dreams.
