The core and supplementary budgets of German municipalities and municipal associations, excluding the city-states, recorded a €20.1 billion financing deficit in the first six months of 2026. The figure matched the record set in the same period last year.

The Statistisches Bundesamt (Destatis) released the preliminary cash-statistics results on Thursday, October 1. Adjusted expenditure rose 2.7% year on year to €204.1 billion, while revenue increased 3.0% to €184.0 billion. Both growth rates were markedly weaker than in the first half of 2025.

Personnel costs climbed 5.2% to €54.7 billion and social-benefit spending advanced 3.9% to €46.3 billion. Interest expenditure grew at a faster 13.1%, while capital investment declined 4.5% and construction spending fell 2.4%.

Net municipal tax receipts edged up 0.9% to €57.3 billion despite a 2.0% drop in net trade-tax revenue. Higher proceeds from property tax and municipal shares of income tax and value-added tax offset that decline.