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Germany promises to cut down paper bureaucracy

March 13, 2024

The German Cabinet will draft a law that it hopes will save companies millions of euros by reducing day-to-day paperwork. But some business leaders say the changes don't go far enough.

Olaf Scholz speaking in the Bundestag
Digitalization is one of the key aims of German Chancellor Olaf Scholz's governing coalition, which consists of the center-left SPD, environmentalist Greens, and business-focused FDPImage: Kira Hofmann/photothek.de/picture alliance

Germany's government promised to slash the country's notorious thicket of bureaucracy on Wednesday.

The Cabinet agreed to draft a new law after a public campaign to cut red tape for German businesses, municipalities and citizens.

Under the changes, hotels would no longer be obliged to register German travelers, signatures for some government forms would be replaced with emails and text messages, and the period that businesses are required to retain tax accounting documents would be reduced from ten to eight years.

According to the Justice Ministry, this could save companies €625 million ($684 million) per year in "space, rental and storage costs."

"Reducing bureaucracy is one of the federal government's major tasks, one of our major projects. And we have taken another major step forward today," Chancellor Olaf Scholz said on Wednesday.

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A world champion in bureaucracy

Plans to cut bureaucracy in Germany are seen as long overdue by many, but some politicians acknowledge that the current plans may not go far enough.

Justice Minister Marco Buschmann from the business-focused Free Democratic Party said that if there was a "world championship in bureaucracy," then Germany would win it.

"It's a bit like building up belly fat over the years. You can't get rid of it overnight by pressing a button," he said in an interview with public broadcaster ARD on Wednesday.

Economy Minister Robert Habeck of the Greens said the draft law was a step in the right direction.

"At the same time, it is clear that we cannot stop here in order to achieve noticeable relief," Habeck said.

The president of the Association of the Automotive Industry, Hildegard Müller, said the move sent the "right signal" but still fell "far short of expectations."

Wolfgang Große Entrup, managing director of the German Chemical Industry Association, said the draft law "does not even begin to provide the necessary relief in day-to-day business."

zc/jsi (dpa, AFP)

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