Germany has reported a projected 2008 public-sector deficit of 0.5 per cent of GDP to the European Union, the finance ministry said last night.
This year's small deficit was due to a cut in corporate tax and a reduction in mandatory jobless benefit contributions, designed to help boost employment, the ministry said.
The budget would return to balance in 2009 and then post surpluses of 0.5 per cent of GDP in both 2010 and 2011, it added.
Germany's total public-sector budget was in balance last year after a 2006 deficit of 1.6 per cent of GDP. Finance Minister Peer Steinbrueck has targeted a balanced federal budget by 2011 at the latest.