Bavaria to Challenge Germany’s Postwar System of State Finances

Bavaria, home to Siemens AG and Bayerische Motoren Werke AG, plans to dispute the legality of Germany’s post-World War II system of financial redistribution among the country’s 16 states.

In a challenge to Chancellor Angela Merkel, Bavarian state Cabinet ministers meeting in Munich today decided to seek changes to the system at Germany’s highest court. Bavaria, the program’s biggest net contributor, will press for more incentives for weaker states to cut debt and spending and a greater balance of “solidarity and responsibility,” the state government said in an e-mailed statement.