German farmers put pressure on traffic light coalition

The German national Farmers' Union DBV and other agricultural organizations have declared the second week of January a national demonstration week against the abolition of the diesel discount and road tax for agricultural vehicles.

In several German cities, farmers have again blocked roads and intersections with their tractors for some time in recent days. The protest week from January 7 to 15 should culminate in another large demonstration at the parliament buildings in Berlin.

The protest week coincides with the first week of meetings in Berlin after the Christmas recess, where final decisions are made on the multi-year budget of the 'traffic light coalition'. Last week, the party leaders of the SPD, FDP and Greens had to adjust the multi-year estimate of their energy transition plan due to a court ruling and make additional cuts of 17 billion in 2024. One of the proposed measures is the abolition of the diesel discount and road tax for agricultural equipment.

These proposed cuts are causing strong reactions not only in agriculture or among the federal CDU/CSU opposition, but also in traffic light factions and governments in almost all German states. Minister Cem Özdemir (Greens) has also publicly spoken out against it, although many German farmers blame him. German media commentaries say that Özdemir has been overruled by his own party leader and Vice-Chancellor Robert Habeck and the liberal FDP members by their own FDP Finance Minister Christian Lindner.

Although Greens and FDP believe that all kinds of environmentally unfriendly 'fossil subsidies' should come to an end, they want money to remain in the agricultural sector, for example for subsidies to stimulate organic and nature-friendly agriculture.

DBV chairman Joachim Rukwied has called the cutbacks unacceptable. After several local tractor demonstrations that got out of hand, he called on German farmers on Saturday to abandon 'pointless blockades' and instead maintain popular support. Earlier this week, he also immediately distanced himself from farmer groups that had 'honoured' the home of a green state minister. 

Previous calculations show that German farmers benefit on average by several thousand euros per year from the current 'diesel discount'. This is not a paid subsidy, but the amount that is deducted annually from their tax bill, depending on their diesel use. As a result, large agricultural companies sometimes have to pay more than 25,000 euros less tax in monetary terms. It is one of the forms of 'fossil subsidies' that is said to promote the use of fossil fuels and hinder the transition to the use of sustainable energy sources.

The German farmers' protest in January coincides with previously announced strikes by freight transport drivers and train drivers on the German railways. With looming strikes in transport and trains, SPD. Last week, FDP and Greens made it very important to reach an agreement on their multi-year estimate for 2024 in a timely manner. Partly because of this, the agricultural protests of recent weeks were a major setback after weeks of difficult coalition negotiations.

There is speculation in German media that the red-yellow-green coalition will have to find a compromise on the diel discount during the Christmas and New Year recess to prevent the survival of their coalition from being jeopardized.