Tax revenues are bubbling up, and yet Frankfurt is on the dry side: the city is expecting a high deficit for this year.

The draft budget, which will be presented to the city council this Thursday, provides for a deficit of around 219 million euros.

Compared to the previous years, which were also not rosy, in which the city posted double-digit million deficits, the current budget tears an even bigger hole in municipal finances.

There is hardly any improvement in sight for the coming year: the city expects a minus of around 127 million euros.

The reserves from which deficits are compensated are dwindling rapidly – ​​according to the calculations, they should be used up by 2023.

Martin Benninghoff

Editor in the Rhein-Main-Zeitung.

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The budget, which the city councilors have been able to view online since Monday, certainly contains news that should put a smile on the face of treasurer Bastian Bergerhoff (Die Grünen).

Because Frankfurt's tax sources are bubbling up - probably also in the next few years.

The tax revenue ratio, i.e. the share of taxes in revenue, is more than 70 percent and should continue to rise moderately.

The most important driver here is the trade tax, which is picking up again strongly after its corona-related slump.

In 2021 it brought in more than two billion euros, more than in the record year 2019. For the current year, the Treasury expects 2.15 billion euros, and the trend should continue: According to the financial planning, the city expects 2023 with 2.2 billion euros, then annually with 50 million euros on top.

Trade tax accounts for almost 49 percent of revenue, no item is more important.

The municipal shares in income and sales tax are also not to be scoffed at, especially since the trend here is also correct: In 2022, income tax is expected to bring more than 499 million euros into the coffers, and in 2025 even 591 million euros.

Sales tax is recovering from its low caused by the pandemic, and here too the treasurer expects continuous increases in the coming years.

That concludes the optimistic part.

Because the income is sucked up.

If you take a closer look at the figures, you can see why: in 2022, Frankfurt received almost 4.38 billion euros in ordinary income, but spent more than 4.58 billion euros.

The corona pandemic plays a large part in this, because tourism has slumped or the health department needs more staff to process corona cases.

Expenditures for social benefits have also risen significantly.

Essentially, allocations and grants in public transport and urban societies are exploding.

While around 58 million euros flowed into local transport in 2020, it will be almost 102 million euros in 2020, and the trend is rising.

Stadtwerke Holding

The losses are not solely due to the pandemic.

The financial result is also visibly weakening, and this has mainly to do with loans to finance the investment program and the interest burden.

In the draft budget, increasing expenditure of more than 2.2 billion euros is planned for the years 2022 to 2025 - which should almost double the debt level between the end of 2020 and the end of 2025.

Although it will take time for city councilors to study the extensive budget, the opposition has already voiced criticism.

The budget "unfortunately exceeds the worst expectations," said Nils Kößler, leader of the CDU parliamentary group on Tuesday.

The coalition made it easy for itself and "apparently simply added up all their party-political wishes".

In addition, no unpleasant decisions were made, "although that is also part of government responsibility".

His deputy Yannick Schwander, chairman of the socio-political wing, said that Frankfurt was "saying goodbye to sound financial policy".

The Left Party criticized the term "crisis budget" that Bergerhoff had coined in advance.

Frankfurt is a "rich city" in view of increasing income from trade and income tax.

The leeway should be used, said parliamentary group leader Michael Müller on Tuesday.

The BFF-BIG parliamentary group called the draft budget "desolate" and "foreseeable".

The upcoming budget debate will develop along the question of how the city's mountain of debt can be reduced in the future given these deficits.

The financial planning for the next few years gives hardly any answers about this and where savings should be made.