Merkel Overruled by Her CDU Party on Start of Income Tax Relief

Leaders of Chancellor Angela Merkel’s Christian Democratic Union agreed last night to consider cutting income tax in Germany from 2017, overruling the chancellor, who didn’t want to specify a date.

On the eve of the party’s annual convention in Cologne today, the leadership gave in to pressure from CDU rank and file and its business wing to start easing income tax bracket creep in 2017, an election year, provided the budget can still be balanced without resorting to other tax increases.

“We discussed this at length in the relevant panels and it became clear that this is a common goal that we want to tackle,” CDU general secretary Peter Tauber said in a speech before the convention.

Merkel has made a balanced budget a priority for her third term, neglecting earlier vows to ease bracket creep that erodes inflation-adjusted income in Germany’s progressive tax system.

Social Democrat Vice Chancellor Sigmar Gabriel has urged tax relief “to the medium incomes, to the middle class.”

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