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Söder Proposes Fewer German States and Expanded Tax Powers for Merged Regions

The CSU leader casts the plan as a remedy for inefficiency driven by Bavaria's heavy transfer burden.

Overview

  • At a CSU caucus meeting in Banz, Markus Söder called for consolidating Germany’s 16 states into larger units to improve efficiency and competitiveness.
  • He proposed granting merged states greater tax-setting authority, including flexibility on inheritance tax, and urged ending the Berlin/Bonn law to eliminate duplicate federal structures.
  • State mergers would require federal legislation through the Bundestag and Bundesrat and, in practice, approval by voters in the affected states, making swift changes unlikely.
  • Söder linked the push to Bavaria’s status as the largest net contributor to the Länderfinanzausgleich and said the CSU would leverage its influence in Berlin’s narrow governing majority.
  • He did not name specific merger targets, praised North Rhine-Westphalia, Bavaria and Baden-Württemberg as more capable, and drew a swift rejection from Saarland’s Anke Rehlinger.