The fiscal reforms that are proposed for Germany in 2007 may have significant economic effects so it is important to estimate the size of these impacts. Our analysis suggests that GDP will be per cent lower in Germany in 2007 as a result of the reforms, with similar impacts in 2008 and 2009. The reforms will have a small but positive impact on GDP in 2006 ( per cent) as a result of bringing forward of consumption in expectation of the VAT increase.