Deutsche Bahn AG regards the recent decisions taken by the Climate Cabinet as excellent news for the railway in Germany and its customers. According to our initial estimates, the German government will provide an additional boost of more than € 20 billion to the German railway sector by 2030.
The key facts in detail:
Firstly, Deutsche Bahn will receive additional equity of € 1 billion per year from 2020 to 2030. By the end of 2030, this amounts to a total of € 11 billion for upgrading and expanding the rail system.
Secondly: the value added tax rate for long-distance rail tickets is being cut from 19 to 7 percent. As a result, rail travel on long-distance routes will be 10 percent cheaper.
Thirdly: the German Federal Government is substantially increasing funding for local public transport. In addition to the rise in Federal funding available under the Municipal Transport Financing Act (Gemeindeverkehrsfinanzierungsgesetz; GVFG) to € 1 billion per year starting from 2021, as already laid down in the coalition agreement, the Federal Government intends to increase the funds to € 2 billion per year from 2025 onwards. A large part of this funding will be used to expand local transport systems and the rail infrastructure in metropolitan areas.
Fourthly, the heads of the Federal Government have agreed to invigorate rail freight transport, making this mode of transport faster and more attractive. This applies both to combined transport, which is becoming increasingly important in a more networked and integrated world of transport, and to single wagon transport, which continues to play a key role in the wide-area coverage of German industry.