Key Regulatory Changes Set to Transform German Business Landscape in 2026

Starting in 2026, German businesses will face significant regulatory reforms impacting cybersecurity, pay transparency, and taxation. Under the NIS-2 directive, companies across various sectors must implement stricter cybersecurity measures by early 2026 to strengthen digital defenses. The Entgelttransparenzgesetz comes into force requiring companies with over 100 employees to report gender pay gaps by June 2026, increasing wage transparency. The Lieferkettengesetz, or supply chain law, will be relaxed to eliminate mandatory annual reporting for larger companies, although diligent oversight must continue.

A new Standortfördergesetz aims to boost startup growth by streamlining bureaucracy and encouraging private investment. Notably, the reduced VAT rate of 7% on food in the gastronomy sector, effective since recent years, will become permanent, offering lasting relief alongside a maintained 19% rate on beverages. Energy-intensive businesses benefit from the introduction of subsidized industrial electricity pricing.

Furthermore, the minimum wage will rise to 13.90 euros per hour in January 2026, while health insurance contributions are expected to increase reflecting rising healthcare costs. Pension reforms will replace the unpopular Riester pension with new schemes. These comprehensive legislative changes collectively aim to modernize Germany's business environment, support employees, and foster economic resilience moving forward.