The German government has estimated the financial cost of the Wuhan coronavirus pandemic at around €1.3 trillion, or $1.6 trillion, for the year 2020, the country’s media report. The news comes as German Chancellor Angela Merkel’s government is incurring huge debts to tackle the coronavirus pandemic and fund economic recovery.
Merkel’s government is expected to finance the shortfall by raising taxes. Merkel left-wing coalition partner, Social Democratic Party of Germany, has demanded a special “coronavirus tax” to finance the fiscal shortfall. “Besides a wealth tax, as coronavorus solidarity tax or hike in the income tax is being discussed,” German business daily HandelsBlatt reported citing government sources.
Berlin may also announce a record tax hike on consumer goods this month, German newspaper Münchner Merkur predicted. “Around turn of the year consumers will face the biggest tax hike in 14 years,” the German daily reported.
The German public broadcaster Deutsche Welle reported the estimated cost of the Chinese pandemic:
The cost of dealing with the fallout of the coronavirus pandemic and subsequent lockdowns in Germany is expected to reach €1.3 trillion ($1.6 trillion), according to government figures.The calculation, published Thursday by the Redaktionsnetzwerk Deutschland (RND), came in a Finance Ministry response to a request by Dietmar Bartsch, the parliamentary leader of the socialist Left Party.The total sum includes “all aid packages, launched by the federal and state governments to date,” the loss of revenue due to the crisis and guarantees at the federal and state level for €826.5 billion, according to the report.The report also calculated that a further €184 billion would be needed in 2021, although this may also include unused or partially unused funds from 2020.
The lockdown imposed by Chancellor Merkel has deepened Germany’s economic troubles, the British newspaper Financial Times predicted. “Germany is heading for a double-dip recession this winter after Berlin imposed a hard lockdown, economists have predicted, denting hopes that Europe’s largest economy will rebound to pre-pandemic levels by the start of 2022,” the business daily reported on December 14.
The European Union is also borrowing at historic levels to artificially boost the faltering European economies. The EU’s “governing council decided … to increase its bond purchase stimulus by 500 billion euros, to 1.85 trillion euros ($2.2 trillion),” the Associated Press reported early December.
With Britain now formally out of the European bloc on the New Year’s Eve, Germany will bear most of the financial burden for the massive economic stimulus rolled out for the EU.
The price tag for the Wuhan virus is expected go even higher as there is no end in sight for the pandemic. Germany recorded 1.7 million case of the Chinese virus, which so far claimed 32,000 German lives. The country has been in hard lockdown since November, dampening the Christmas and New Year celebrations.
Germany’s main opposition party, the Alternative for Germany (AfD), has slammed Chancellor Merkel for ruining the country’s economy with her hard lockdown measures. “She locks up citizens and destroys entire industries,” AfD chief Alice Weidel said recently in the parliament.
Despite the roll-out of a nationwide vaccination program, the lockdown measures are expected to be in place for an indefinite duration. German health minister on Wednesday declared that the coronavirus restrictions will last longer than previously expected and the country was “very far away from normality.”
In her traditional New Year’s address, Chancellor Angela Merkel described the pandemic as a “historic crisis” in the country’s post-war history.
This was probably Merkel’s last annual address to the nation as German Chancellor after 15 years at the helm. Merkel has announced her decision not to contest the next general election scheduled in nine months time. “Today I am likely speaking to you on New Year’s as Federal Chancellor for the last time,” she concluded.
‘Germany announces Christmas lockdown’
CLICK HERE FOR FULL VERSION OF THIS STORY