DATEV Representative Urges Germany to Cut Red Tape and Tax Burden for Businesses

Prof. Dr. Robert Mayr, speaking for the German cooperative DATEV eG, calls in a sponsored column on Politico Europe for growth to return to the centre of Germany's economic policy. The piece is labelled political advertising and sponsored by DATEV itself, so it should be read as the view of an interested party rather than independent editorial analysis.

The state of mid-sized firms

For more than two years, DATEV has run its Mittelstandsindex, which tracks the development of Germany's small and medium-sized businesses (the Mittelstand). According to the author, it shows not a sudden collapse but a gradual exhaustion: revenue is not recovering in a lasting way, while wages and other costs keep rising. Employment, long a pillar of stability for these firms, is increasingly under pressure. In his words, the Mittelstand is holding on but is not in an upswing.

As a result, the author says, companies are directing their funds mainly toward preserving what they have and replacing equipment, while expansion, new technologies and extra capacity are harder to finance.

What the author proposes

The column calls for less bureaucracy, including lighter permit and reporting requirements, which it says hit small and mid-sized companies particularly hard. The author notes that in 2025 the state's share of the economy (Staatsquote) exceeded 50 percent and argues for a leaner but still capable state. He contends that Germany does not have a revenue problem and opposes a higher top tax rate, because for partnerships and sole proprietorships income tax is effectively the business tax.

At the European level, he wants national special rules and fragmentation reduced so that young companies can grow across borders and raise capital. He expects digitalisation, artificial intelligence, demographic change and geopolitics to reshape the economy profoundly by 2030, and calls for a change of course.