"Tomorrow, tomorrow, just not today, everyone says..." The beginning of this German children's song named "The Procrastination" from the 18th century is likely familiar to a contemporary children's book author. It shouldn't be assumed, however, that a climate minister would draw inspiration from it in the daily political affairs. Especially since even a former minister of agriculture doesn't become a farmer expert just by dealing with "chickens, pigs, cows milking" at home. No, the fact that German citizens will be waiting in vain for the payout of the promised climate money in the beginning of the year 2024 has nothing to do with any craftsmanship issues in the Ministries of Economy and Climate. It is primarily related to the switch of the spending traffic light from a long green phase to yellow or even red. In the FDP-led Ministry of Finance, everything related to jeopardizing compliance with the debt brake in 2024 is being shelved since the Constitutional Court ruling on the Climate and Transformation Fund (KTF) – regardless of the coalition agreement.

There is no shortage of reasonable proposals on how the promised relief for citizens with the climate money could be achieved not tomorrow, but today. As the CO2 levy has increased from 30 to 45 euros per ton at the beginning of the year, this alone results in additional costs of 8.1 billion euros for private households in 2024. Leading economists and climate policymakers fear that delayed relief in 2025 and the resulting social upheavals could seriously damage the acceptance of the CO2 pricing – a central tool in Germany's and the EU's decarbonization strategy. This would be particularly disastrous because in 2027, the next stage of the European Emissions Trading System (EU-ETS2) begins, where carbon certificate market prices will replace the current national levy. And according to expert estimates, prices of up to 300 euros per ton of CO2 are to be expected.

Consumer protection agencies may convincingly calculate that the CO2 levy on gas, oil, and fuel alone has brought the state over 11 billion euros in additional revenue since 2021, and therefore, theoretically, a per capita climate money of 139 euros should be paid out for the past three years. In practice, however, this is not possible. Firstly, as billions of euros have already flowed out through a leak in the bucket of KTF funds, known as the EEG (Renewable Energy Act) levy. And secondly, the financial administration is still working on assigning an IBAN to each eligible German citizen for the transfer of climate money.

Since the CO2 levy disproportionately burdens households with lower incomes as a consumption tax, the relief should be carried out through consumption as well – according to common understanding. Unlike the climate money, this could be immediately achieved through a reduction in electricity tax, network charges, and other levies on the electricity price, as recently proposed by the Initiative New Social Market Economy (INSM). It could also be accomplished through a general reduction of the value-added tax. Or of the income tax, as preferred by Ifo President Clemens Fuest, who recommends a combination of an increase in the basic tax-free allowance, a reduction in marginal tax rates, and an increase in citizen's income for distributional reasons.

The compulsion to adhere to the debt brake should lead the coalition to rethink climate policy: away from subsidies, such as those for electric cars, heat pumps, or photovoltaics, and towards even stronger CO2 pricing, especially with regard to ETS2. However, this presupposes that the revenues from it flow back in full to the affected households and companies. Not "tomorrow," meaning from 2025 on as climate money, but immediately and without bureaucracy as a tax relief.