in 2018 has reached the redistribution between the better and worse-off provinces with a new record: the amount in The financial equalisation amounted to 11,45 billion Euro, as of provisional Figures of the Federal Ministry of Finance. In the previous year, there were approximately 11.2 billion euros.
The financial equalisation regulates the distribution of revenues between the Federal government, the länder and the municipalities. Bayern paid 6.7 billion euros, more than half of the total-were 785 million more than the year before. After Bavaria, Baden-Württemberg paid nearly € 3.1 billion the most in the distribution pot, Hesse follows with 1.6 billion Euro, Hamburg was around 83 million euros.
the Biggest recipient of Berlin was once again with 4.4 billion euros. After Berlin and Saxony were particularly with 1.1 billion euros, North Rhine-Westphalia, with 1.01 billion euros, lower Saxony, with around 830,000 Euro and Bremen, with some 740,000 Euro is a great receiver.
From 2020 onwards, a new System
Each of the 16 Federal States has due to its economic, geographic, and regional characteristics, different levels of income. The main aim of the financial compensation, the “uniformity of living conditions is, according to the basic law”. Financial equalization between the länder is to be replaced by 2020 in its present Form by a System to compensate for the VAT imbalances.
click here to read: How the financial equalisation among the States in the future
The countries share of this work is to be distributed according to the number of inhabitants, modified by increases and reductions depending on their financial strength. In addition, the Federal government intervenes poorer countries are more and more under the arms, with the first year EUR 9.75 billion. The Federal government receives, in turn, more intervention rights – for example, in the case of highways, the tax administration, investment in schools and Online-Offered by the administration.