Overview

• Friedrich Merz stated that the planned income tax reduction for small and middle incomes is conditional and not guaranteed, contrary to earlier expectations from the coalition agreement.
• The implementation of tax cuts will depend on public budget conditions, reflecting fiscal constraints and economic realities.
• Merz dismissed the possibility of an automatic increase in the minimum wage to 15 euros, emphasizing that such decisions rest solely with the independent Minimum Wage Commission.
• Concerns have been raised that rising social contributions and potential delays in tax cuts could leave workers with lower net incomes by the end of the legislative period.
• Key SPD proposals, such as taxing high earners and mandating a minimum wage hike, were excluded from the coalition agreement, highlighting ongoing tensions within the government.