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Major Policy Adjustments for Expats and Residents in Germany in 2026
Starting in 2026, several significant changes will affect daily life in Germany, impacting expats, international students, and foreign workers alike. The German government has introduced a range of legal and financial modifications, including an increase in the statutory minimum wage, changes in public transport pricing, and new procedures relating to the Bundeswehr (German armed forces). These updates are set to influence living costs, taxation, and civic obligations for those residing in Germany [Source 2].
Minimum Wage and Social Security Contribution Adjustments
One of the most notable changes is the rise in the statutory minimum wage, which will increase in two phases: from €12.82 to €13.90 per hour as of January 2026, with a further rise to €14.60 planned for 2027. Apprentice wages will also see increments, with the first-year apprenticeship allowance rising to €724 monthly, reaching €1,014 by the fourth year. Additionally, the contribution assessment ceiling for statutory health and long-term care insurance will grow to €5,812.50 per month, leading to higher social security contributions for some earners. For example, employees at the upper earnings threshold could see an increase of approximately €28.50 monthly for health insurance premiums [Source 1][Source 3].
The tax-free basic allowance for income tax will also rise slightly, from €12,096 to €12,348 annually, which can offer minor relief on taxable incomes [Source 1].
Transport Costs and New Bundeswehr Survey for 18-Year-Olds
The popular Deutschlandticket, providing access to local and regional public transport, will become more expensive, increasing from €58 to €63 per month starting January 2026. This change will affect daily commuters, including expats relying on public transit for work or study. The price rise could increase monthly transport expenses, a key consideration for budgeting in urban centers [Source 1][Source 2].
On a different note, all individuals turning 18 in 2026, including foreign residents, will receive a questionnaire assessing their suitability and motivation for voluntary service in the Bundeswehr. This survey is part of a broader recruitment effort and represents a new civic engagement step for young adults living in Germany [Source 1][Source 2].
Additional Consumer and Legal Changes Relevant to Expats
Other regulatory changes include the renaming of Bürgergeld to Grundsicherung (basic social security), with tighter measures for those missing mandatory job center appointments or refusing employment. The reduced VAT rate on food served at restaurants will become permanent at 7%, potentially affecting dining costs. Moreover, social parameters such as the children’s tax allowances are set to increase, directly benefitting families, including those with foreign origins [Source 2][Source 5][Source 7].
Meanwhile, increased CO2 pricing on fuels and heating will raise living expenses related to transport and household energy, with the CO2 price set via market mechanisms rather than fixed rates, adding variability to costs [Source 1][Source 7]. Expats should monitor these developments closely to anticipate adjustments in their budgets and tax filings.
For detailed coverage of all legislative and financial changes coming in 2026, readers can consult the comprehensive overview at Tagesschau: https://www.tagesschau.de/inland/innenpolitik/ausblick-aenderungen-2026-100.html [Source 2].
