A trade group in Bavaria, southern Germany, has lodged a complaint with the European Commission about Austria’s Handwerkerbonus, or craftsperson bonus, saying it unfairly harms German businesses.

Bavaria borders Austria’s states of Upper Austria, Salzburg and Tyrol. The Chamber of Skilled Trades for Munich and Upper Bavaria argues the bonus breaches EU state aid rules.

The scheme offers Austrian households a refund on home improvements carried out by skilled tradespeople, such as painting, kitchen installations, tiling and window replacements. However, it only applies to work carried out by firms based in Austria or with an Austrian branch.

Households can claim back up to 20% of labour costs, with a maximum grant of €2,000 for 2024, which will drop to €1,500 in 2025. Individuals can submit one application per calendar year, covering multiple invoices if necessary.

Frank Hüpers, Managing Director of the Bavarian Chamber, said the rules effectively exclude Bavarian businesses from competing on an equal footing.

“Customers are likely to choose an Austrian tradesperson to benefit from the bonus, putting our businesses at a disadvantage. That’s why we have filed an official complaint with the European Commission for breaching EU aid regulations,” he said.

Austria Defends the Bonus

Austrian Labour Minister Martin Kocher has dismissed the complaints, insisting the scheme complies with EU regulations.

“The craftsperson bonus was introduced to stimulate the construction sector and support households,” Kocher said. “It underwent a thorough legal review by experts, which confirmed it aligns with EU law.”

The average subsidy under the scheme is around €800, with a total of €300 million set aside for it over 2024 and 2025.