In 2026 the trade tax multiplier (Gewerbesteuer-Hebesatz) in Germany's 20 largest cities ranges from 410% in Berlin to 537% in Bonn (DIHK survey as at 31 December 2025 and 1 July 2026). On every €100,000 of trade income, that means €14,350 to €18,795 of tax. For a GmbH that lets a supermarket, the multiplier matters only if the extended reduction of the trade-tax base (erweiterte Kürzung) does not apply.
The tax is income times 3.5% times the municipal multiplier
Trade tax (Gewerbesteuer) is levied by the municipality: trade income is multiplied by 3.5% and by the local multiplier (§§ 1, 11(2), 16(1) GewStG). A German limited-liability company (GmbH) is liable by virtue of its legal form (§ 2(2) GewStG). It has no €24,500 allowance: that is available only to individuals and partnerships (§ 11(1) GewStG). The tax itself does not reduce taxable profit (§ 4(5b) EStG). From 2027 the minimum multiplier rises from 200% to 280% (§ 16(4) GewStG).
The tax is due to the municipality in which the company has a permanent establishment (Betriebsstätte, § 4(1) GewStG). For a GmbH with a single let store, this is not necessarily the town where the store stands; which municipality is entitled to levy the tax should be established with a tax adviser.
Two of the twenty cities changed their multiplier in 2026
Exhibit 1. Berlin and Bonn differ by €4,445 of tax on €100,000 of income
Sources: DIHK, 2026 survey of trade tax multipliers, table "Realsteuer-Hebesätze 2026 nach Bundesländern" (data as at 31 December 2025 and 1 July 2026; cities ranked by population according to the DIHK). For Essen and Duisburg the values were checked against official city documents. Tax: our calculation (€100,000 × 3.5% × multiplier).
Stuttgart raised its multiplier from 420% to 430% from 2026; Essen lowered it from 480% to 479% and plans to lower it by one point a year, for five years in total.
Across Germany, multipliers rise more often than they fall. According to the DIHK, 88 of the 706 towns and municipalities with 20,000 or more inhabitants raised theirs in 2026, and 5 lowered them. The population-weighted average rose from 439% to 441%, and the range runs from 250% in Monheim am Rhein and Leverkusen to 580% in Oberhausen and Mülheim an der Ruhr. North Rhine-Westphalia has the highest weighted average of all the states, at 476%.
The extended reduction takes rental income out of the base — on strict conditions
A company that exclusively manages and uses its own real estate can apply to exclude that income from the trade-tax base (§ 9 no. 1 sentence 2 et seq. GewStG). Only narrow exceptions are allowed: services to tenants up to 5% of rental income, and electricity from renewable sources and electric-vehicle charging up to 20%.
In a supermarket, the classic trap is refrigeration plant and other operating equipment (Betriebsvorrichtungen) let together with the building. The Federal Fiscal Court has held that installations the landlord must provide for structural or technical reasons, such as a goods lift, do not necessarily rule out the relief (BFH, judgment of 25 September 2025, IV R 31/23). But refrigeration equipment still has to be checked case by case.
Without the extended reduction, corporate income tax and trade tax together take roughly 25–33% of a GmbH's profit (see Part 9 of the series German Prime Retail). In addition, a quarter of interest and other financing costs above €200,000 a year is added back to the trade-tax base (§ 8 no. 1 GewStG). In the example in Part 11 of the series, a GmbH funded with equity only would pay about €25,000 a year more without the reduction, at a multiplier of 400%.
Implications for investors
1. First establish whether the extended reduction applies. Only without it does the multiplier matter to a GmbH that lets a supermarket; corporate income tax and trade tax then together take roughly 25–33% of its profit.
2. Check the equipment let together with the building. Refrigeration plant is the classic trap: the BFH has held that installations the landlord must provide for structural or technical reasons do not necessarily rule out the relief, but refrigeration equipment needs a case-by-case check.
3. Establish which municipality is entitled to levy the tax. The tax is due where the company has its permanent establishment, not necessarily where the store stands, and Berlin and Bonn differ by €4,445 on every €100,000 of income.
What to check:
• Find out which municipality is entitled to levy the tax, and what multiplier it has set for the coming years.
• Obtain a tax adviser's opinion on the extended reduction for the specific lease before the purchase contract is signed.
• Request an inventory of the assets let together with the building, with a separate list of operating equipment.
• Check that income from electricity, charging and services to tenants stays within the 20% and 5% limits.
See also: How much does it cost to set up and run a GmbH?; Commercial property yields in Germany in 2026; Grunderwerbsteuer (real estate transfer tax).
Sources: DIHK, Hebesatzumfrage 2026 and "Realsteuer-Hebesätze 2026 nach Bundesländern" (October 2026); City of Essen, press release of 10 December 2025; City of Duisburg, multiplier bylaw (Hebesatzsatzung) as amended on 27 February 2026; GewStG §§ 1, 2, 4, 8, 9, 11, 16; EStG § 4(5b); BFH, judgment of 25 September 2025, IV R 31/23; German Prime Retail series, Parts 9 and 11. Law as at 10 October 2026.
Photo: Didier Weemaels / Unsplash
This page is general information and not investment, legal or tax advice.