Germany legislates a corporate tax cut to 10% by 2032
The 15% corporation tax falls one point a year from 2028, changing the medium-term cost of a German subsidiary.
- Where
- EU ↔ UK · India ↔ UK & EU · US ↔ EU
- Published
- Last reviewed
- Prepared
- Prepared by the Intelligence desk with AI-assisted research from the cited sources, checked on 12 November 2026.
- Effective
- 1 January 2028
- Version
- 1
What changed
Germany's corporation tax rate of 15% (15.825% with the 5.5% solidarity surcharge) is legislated to fall by one percentage point a year from tax year 2028, reaching 10% from 2032. Municipal trade tax, set locally, is unchanged, so the combined burden still depends on the city. For 2026 the effective combined rate typically sits around 30%.
Who is affected
Groups with or planning German subsidiaries or branches; companies comparing Germany with the Netherlands or France for an EU base; investors modelling German returns beyond 2027.
Why it matters
A five-point fall in the federal rate changes after-tax returns on German operations and the comparison with other EU locations, but only from 2028. Decisions taken now still face today's rates for two more years, and trade tax continues to vary by municipality.
What to examine next
Model the combined rate for the specific municipality.
Check whether the group is within the global minimum tax rules (Pillar Two), which can reduce the benefit.
Revisit transfer pricing for German entities as the rate gap with other countries changes.
Compare with the Netherlands and France in the European operating base Decision Map.
Sources
- Germany: Taxes on corporate incomePwC Worldwide Tax Summaries · published 30 Jun 2026 · checked 12 Nov 2026 · secondary source
- Germany Highlights 2026Deloitte · published 12 Nov 2026 · checked 12 Nov 2026 · secondary source
Next steps, if you need them
Original analysis by the UNBOUNDED Intelligence desk. Linked sources belong to their publishers. This briefing is information, not legal, tax, investment or other professional advice. Its appearance here is not an endorsement by UNBOUNDED or any institution of a transaction, jurisdiction, strategy or counterparty.