Coalition forced to weigh up tax hikes

Coalition forced to weigh up tax hikes
Photo: DPA
German taxpayers face extra burdens as the federal government considers tax rises to tackle the gaping budget deficits forecast in the years ahead, a media report said Friday.

Business daily Handelsblatt quoted an unnamed government source as saying that a limited group of taxpayers might have to accept paying more.

“It’s not about the introduction of a new tax like the wealth tax, rather very much about the additional burden for a reasonable group of taxpayers,” the source, described as “government representative”, told the paper.

Even leaders within the pro-business Free Democrats (FDP), who have had to curb their ambitions to cut taxes and have, in the past, ruled out rises, now admit some hikes may be necessary, the paper cited sources in government circles as saying.

It was not known where any increases might be made. Previously, leaders of both coalition partners – Angela Merkel’s Christian Democrats and the FDP – have ruled out any general increase to the sales tax.

But there was talk of evening out the inconsistencies brought about by reductions on sales tax in specific product areas, Handelsblatt reported.

“Several billion euros could be saved here,” a coalition source told the paper.

However, tax rises are still strongly opposed by many in the government.

“I am absolutely against tax increases,” said Hans-Peter Friedrich, the leader of the parliamentary group of the Bavarian conservatives, the Christian Social Union. He pointed that the centre-right coalition had not spoken of tax rises for a long time.

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