In addition to the size of the property and the development, the location of the property in the municipality is also assessed using the area-location model. This recalculation leads to a change in the total revenue from property tax in Wolfsburg. Due to both legal requirements and a resolution passed by Wolfsburg City Council in 2019, the reform should neither lead to a reduction in revenue for the municipality nor to an increase in property tax for all citizens.

In order to achieve this goal, it is necessary to adjust the assessment rates. The administration is therefore proposing to Wolfsburg City Council that the assessment rate for property tax B be adjusted from next year. A corresponding council bill has now been published and will be submitted for political consultation.
In 2024, property tax B will contribute around 34 million euros to the financing of public tasks. Without an adjustment to the assessment rate for property tax B, a tax deficit of three million euros would be expected. In order to keep the current revenue of around 34 million euros stable, an increase of 50 percentage points is proposed. This would increase the assessment rate for property tax B from 545 to 595 percent.

"We would have liked to avoid adjusting the assessment rate, but it is unfortunately unavoidable in the current situation," explains treasurer Andreas Bauer. "The legal requirements and the new calculation basis require this measure so that we remain revenue-neutral. Our aim is not to generate additional revenue, but to ensure the financial stability of the city and maintain the existing revenue."

As part of the revaluation and the adjustment of the assessment rate, there will be changes to the individual tax burden - some taxpayers will see their contributions rise, while others will see them fall. Overall, however, municipal revenue from property tax will remain at the same level. Other municipalities will also have to change their assessment rates as a result of the property tax reform. At 100 to 150 points in some cases, the adjustments to the assessment rate are significantly higher than in Wolfsburg.

The final decision on the adjustment of the assessment rate for property tax B will be made by Wolfsburg City Council at its meeting on November 13. If approved, the new assessment rate will come into force on January 1, 2025.

Property tax A and property tax B in Lower Saxony

In Lower Saxony, a distinction is made between property tax A and property tax B. Property tax A applies primarily to agricultural and forestry land, while property tax B is levied on developed and buildable land in urban and rural areas. In Wolfsburg, property tax A plays only a minor role compared to municipalities with an agricultural focus, with tax revenue of around EUR 140,000. Property tax B, on the other hand, is one of the city's most important sources of income, as it is levied on residential and commercial properties. This distinction is central to budget planning, as property tax B accounts for a large proportion of the city's property tax revenue and therefore contributes significantly to the financing of public services.