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The Covid pandemic confronted the Merkel IV government with unprecedented fiscal challenges. We argue that the government's response to these challenges constitutes a break with established patterns of German fiscal policy orthodoxy in at least three areas. First, the government suspended the debt brake and gave up the 'Schwarze Null' without much debate. Second, it implemented a fiscal rescue package that struck a new balance between the interests of the export and the domestic sector. Third, the government supported a coordinated fiscal response on the European level thereby giving way to debt pooling across EU member states. The article traces the groundwork for these changes that was laid in the first two years of the government and then compares the German fiscal response to Covid-19 with German policy during the Financial Crisis. We conclude by discussing whether Germany has shifted to a new fiscal policy regime. [ABSTRACT FROM AUTHOR]