The German upper house of parliament, the Bundesrat, adopted government proposals July 6 to cut the corporate tax rate from around 38.7% at present to under 29.8% from next year.
The draft bill had already been passed by a large majority in the lower parliamentary house, the Bundestag, in May.
Corporate tax rates in Germany are currently among the highest in the EU. But the new changes will put the eurozone's biggest economy in mid-field compared with its European partners.
The government's aim in the reform is to make Germany more attractive for investors and thereby help boost long-term economic growth. The reforms will enable companies to cut their tax bills by around 30 billion euros. Nevertheless, the government hopes to rein back 25 billion euros in some of the lost revenues by scrapping tax breaks and closing tax loopholes for many companies.
Copyright Agence France-Presse, 2007
