Germany’s Coalition Opens Door to 8-Hour Sunday Bakeries While Boosting Tax-Free Pay for Weekend Work
04.07.2026 - 03:05:46 | boerse-global.de
Sunday and public holiday wage supplements will become more attractive for German workers starting in 2027, after the coalition committee agreed on Thursday to raise the tax-free threshold on such premiums to a base hourly wage of €75—up from €50 today. The extra pay will also be fully exempt from social security contributions.
The change is part of a 34-point package designed to lift economic growth above 1% in 2027. It accompanies a landmark shift in Sunday working hours for bakeries: from 1 January 2027, the craft bakeries will be allowed to operate for up to eight hours on a Sunday, scrapping the current three-hour limit that has long frustrated the industry.
But the new freedom may prove theoretical in some states. Bavaria, which enacted its own shop-closing law in August 2025, still caps Sunday sales at three hours. The federal reform only expands the framework under employment law—Bavarian businesses would need a local rule change to exploit the extra hours. “The Länder will have to adjust their regulations,” a coalition spokesperson noted.
The practical friction has a history. Bakeries that operate café sections have often sidestepped the old restrictions by classifying their sales under the Gaststättengesetz (restaurant and pub law). The new reform aims to remove that patchwork of loopholes.
Chancellor Merz confirmed after the negotiations that a fully new working-hours law remains unfinished. The Sunday hours are the first concrete decision, with a larger overhaul of working-time models expected this summer.
Industry praise and union pushback
The Zentralverband des Deutschen Bäckerhandwerks (German Bakers’ Trade Association) broadly welcomed the longer Sunday window but criticised a separate tax hike in the same package: the flat tax on mini-jobs (geringfügige Beschäftigung) will rise from 2% to 5%, adding costs for employers.
The Catholic Workers’ Movement (Katholische Arbeitnehmer-Bewegung) warned that the Sunday opening expansion erodes the constitutional protection of that day. “The coalition is trading social consensus for short-term flexibility,” a spokesperson said.
Financing and other measures
The government aims to fund the package with a higher wealth surcharge: personal income above €250,000 per year will be taxed at 45%, and income above €280,000 at 47%. The changes also include a ban on nationalising private rental apartments and the abolition of the telephone sick note—employees will again need a doctor’s certificate from the first day of illness.
The federal budget proposal for 2027 is scheduled to be presented on Monday.
