Saxony continues to benefit greatly from state financial equalization

Saxony continues to be one of the biggest beneficiaries of the federal financial equalization scheme. Berlin remained the largest recipient state in 2024 with around 3.94 billion euros, followed by Saxony (around 3.25 billion) and Thuringia (2.04 billion), according to a submission from the Federal Ministry of Finance, which is available to the German Press Agency. The other eastern states also made good money: Saxony-Anhalt with 1.81 billion euros, Brandenburg with 1.44 billion euros and Mecklenburg-Western Pomerania with 1.42 billion euros.

Bavaria pays in the most money by far

Around 18.65 billion euros were redistributed in Germany in 2024 as part of the fiscal equalization scheme. Bavaria was once again the largest contributor. With around 9.77 billion euros, the Free State contributed 52.4 percent of the total volume and thus paid in 7.05 percent more than in the previous year. More than two-thirds of the money, 13.92 billion euros, went to eastern Germany. Apart from Bavaria, only Baden-Württemberg, Hesse and Hamburg are donor states.

In 2023, Bavaria filed a lawsuit in Karlsruhe

The federal financial equalization system redistributes money between financially strong and financially weak states and is intended to ensure more or less equal living conditions in Germany. In 2023, Bavaria filed a lawsuit against the fiscal equalization system with the Federal Constitutional Court because it has been paying in the most money for years. However, it remains to be seen when the court will make a decision.