Germany Unveils Tougher Tax Crime Action Plan with Harsher Penalties

The German government presented a 26‑point action plan to combat tax and financial crime, announced by Finance Minister Lars Klingbeil and Justice Minister Stefanie Hubig. The plan re‑classifies serious tax evasion as a criminal offence, removes the self‑report exemption and raises the maximum prison term for organised tax fraud from 10 to 15 years. It also proposes a universal register‑cash‑register requirement, extends the retention period for accounting records to 15 years, and increases fines for corporate offenders.

A new joint Centre against Tax and Financial Crime will be established at the customs authority, supported by a data‑analysis hub that will employ artificial‑intelligence tools to detect complex fraud patterns. The measures aim to boost revenue by billions of euros and to strengthen whistle‑blower protection and European cooperation.

While the federal coalition stresses the need for tougher enforcement, Bavaria’s Finance Minister Albert Füracker warned that the plan places a heavy bureaucratic burden on the states and questioned the public‑shaming of firms. He called for more dialogue and coordination with the Länder.