German coalition government moves toward comprehensive reform package

The leaders of Germany's governing coalition — SPD, CDU and CSU — met in the Kanzleramt to negotiate a wide‑ranging reform package covering taxes, pensions, health care and long‑term care. Party chairs Bärbel Bas, Lars Klingbeil, Friedrich Merz and Markus Söder are set to brief the press at a conference scheduled for Thursday morning.

President Frank‑Walter Steinmeier expressed optimism, saying the talks occur "in a veritable crisis" but that the outcome should "point forward" and improve public mood. Chancellor Merz cautioned that the reforms will not arrive as a single "big bang" but will be introduced step by step.

Business groups, including the BDI, called for immediate relief for companies, urging the abolition of the solidarity surcharge and a reduction in bureaucracy. Meanwhile, the Taxpayers' Association warned against raising the top and wealthy income tax rates, a proposal floated by SPD finance minister Klingbeil.

The coalition aims to present the reform measures to the public in the coming days, hoping they will boost growth, competitiveness and public confidence.