Action package for growth and combating inflation

In a ministerial council speech at the beginning of September 2025, the Austrian federal government presented strategic priorities for strengthening economic growth, combating high inflation, and implementing structural measures to improve long-term competitiveness. The key aspects – which mainly revolve around tax incentives and financial measures – are outlined below. By prioritizing existing budget resources differently, no additional requirements for the federal budget are intended. The implementation remains, however, to be seen.

Relief for energy-intensive companies

The Electricity Price Cost Equalization Act of 2025 and 2026 are intended to relieve energy-intensive companies. The goal is to offset the indirect additional costs generated by the carbon dioxide price and to prevent the migration of industrial businesses ("carbon leakage").

Doubling of the investment allowance

See the separate article in this issue for more information.

Reduction of electricity bills

The EAG subsidy (Renewable Expansion Act) is to be reduced by approximately €85 million for the year 2026 to relieve households, businesses, and industry from the costs of electricity.

Limit for occasional extra earnings

The threshold for low-paid work will be frozen until 2027. See also the article "Social Security Benefits 2026" in this issue.

Additional income in the pension

A model is planned that is intended to make the supplementary earnings of regular pensioners more attractive. This is expected to come into effect from January 1, 2026, without, however, detracting from the attractiveness of the partial pension.

Inflation reduction through federal fee brake

Federal price increases, such as fees, should be examined in terms of their impact on the consumer price index (CPI) and, if necessary, mitigated.

"Alliance for Fair Food Prices"

To combat the still high inflation, the government plans to create a so-called "alliance for fair food prices". In addition to legal regulations to label "shrinkflation", the price commission is also to be reconstituted. Statistics Austria is to contribute to identifying unjustified price policies through a database for comprehensive price monitoring.

Restriction of rental prices

The indexing of rents that was already suspended in the full scope of the MRG will % be limited to % 1 for 2026 and 2 for 2027.

Strengthening the "Action 55 Plus"

With €50 million per year starting in 2026, the employment rate of older and long-term unemployed people is to be increased. Furthermore, incentives to work more hours are planned.

Bureaucratic reduction

A comprehensive package to streamline bureaucracy is expected to be presented by 2025. This package will include a federal unification law, the reduction of reporting obligations, and faster approval procedures.

Location funds

To be able to encourage future investments in Austria, a "location fund" is to be established with public anchor investments and private capital, in order to keep particularly innovative "scale-ups" in Austria.

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