News

In a new study commissioned by the Federal Environment Agency (UBA) FiFo-researchers use improved data sets to quantify the tax benefits enjoyed by company car users under the so-called ‘1 per cent rule’. For 2024, the blanket rule is associated with a shortfall in tax revenue of 4.2 billion euros, as well as approximately 1.68 million tonnes of additional CO₂ emissions. The study represents a methodological improvement by examining the effects of vehicle provision and use separately. From a tax policy perspective, the move to a '1.7 per cent rule' is recommended.

Green budgeting – aligning budgetary policy with climate and environmental goals – is rising up the agenda at EU, national and subnational levels, and the challenge is increasingly practical. FiFo-Köln, as technical expert, has accompanied the development of a practical green budgeting tagging methodology for Baden-Württemberg*. The policy brief “Green budget tagging in practice” outlines the approach taken in Baden-Württemberg alongside equivalent methods in two other European administrations: the Italian Region of Lombardy, and Greece. Its core message is clear: green budget tagging is not a one-off technical exercise but a multi-cycle reform process.
*Project funded by the European Union via the Technical Support Instrument and implemented by Expertise France in cooperation with the European Commission

The impending collapse of German municipal financesis due to rising expenditure, particularly on services such as youth welfare, integration support and care assistance. In accordance with the principle of causal connectivity – ‘who orders, pays’ – there are frequent calls for better federal funding of these municipal services, which are determined at central government level. In a new FiFo Discussion Paper, Michael Thöne examines solutions based on the ‘who orders, pays’ principle and on the principle of ‘who implements, pays’. As neither promises a sustainable solution, he recommends considering the complete centralisation of these services. Shifting the responsibility for implementation upwards too would, in practice, be significantly less demanding than it appears at first glance.

What role do sound local government finances play in a municipality’s ability to provide affordable housing? This is a highly topical issue in numerous countries worldwide. The United Nations Human Settlements Programme (UN-Habitat) and the Canada Mortgage and Housing Corporation (CMHC) have launched an international research project on this topic. Germany is among the first countries to be studied. FiFo Director Michael Thöne said: “Thank you very much for the honour of being the first interviewee worldwide for this important new project. I wish you every success and look forward to more of these transatlantic exchanges”.

The bar is set high for a future-proof structural and regional policy. On behalf of the Federal Environment Agency, FiFo Köln, together with Difu and the Öko-Institut, is investigating the extent to which support programmes within the Pan-German Funding System (GFS) are already striving for an ecologically sustainable, forward-looking and transformation-oriented structural policy. Fourteen programmes were analysed, including the Joint Task ‘Improvement of the Regional Economic Structure’ (GRW). The comprehensive interim report, which has now been published, provides the centrepiece of the empirical analysis. The results show that, whilst relevant approaches do exist, they are often not implemented systematically.