Germany's Tax Revenue Sees 5.3% Boost in August

Germany's federal and state governments saw a 5.3% increase in tax revenue in August compared to last year, totaling 61.9 billion euros. Despite earlier declines, the overall trend is positive, with a 2.3% rise from January to August. However, the economy faces challenges with an unexpected 0.1% contraction in the second quarter.

Germany's federal and state governments' tax revenue rose by 5.3% in August compared to the same month last year, the finance ministry reported on Friday.

Total tax revenue reached 61.9 billion euros ($68.9 billion) last month, rebounding from a 7.9% decline in July. Despite this volatility, the long-term trend remains encouraging with a 2.3% increase from January through August, amounting to 539.79 billion euros.

However, the German economy, which contracted by 0.1% in the second quarter, continues to battle economic challenges. Core inflation remains high, despite a general downward trend in inflation, heightening recession concerns. The German government projects a modest 0.2% growth for this year, with an updated forecast due on Oct. 9. Analysts foresee tax revenue climbing to 863.68 billion euros for the entirety of 2024, marking a 4.1% year-on-year increase, according to the report. ($1 = 0.8979 euros)

(With inputs from agencies.)