Germany plans to increase 2027 net new borrowing to EUR118.0bn (about $135bn), roughly 7% above April projections, a finance ministry official said. The rise reflects weaker-than-expected tax receipts, higher interest rates raising debt-servicing cos

2026-07-05

Germany plans to increase 2027 net new borrowing to EUR118.0bn (about $135bn), roughly 7% above April projections, a finance ministry official said. The rise reflects weaker-than-expected tax receipts, higher interest rates raising debt-servicing costs, and additional funding needs at the Federal Employment Agency for unemployment benefits. Chancellor Friedrich Merz and Finance Minister Lars Klingbeil has proposed a reform package covering pensions, healthcare and taxes; the cabinet is expected to approve the package and the 2027 budget on Monday.