By Andreas Rinke and Miranda Murray
BERLIN, July 2 (Reuters) – German Chancellor Friedrich Merz’s ruling coalition unveiled a package of reforms on Thursday, including €10 billion ($11 billion) in annual tax relief for lower income earners, changes to the pension system and building more affordable housing.
Trailing in opinion polls behind the far-right Alternative for Germany party, Merz has faced heavy pressure to pass reforms to revive Europe’s largest economy but has struggled to overcome internal coalition wrangling and gain momentum.
“We want to get Germany back on track,” Merz told reporters on Thursday.
The long list of measures aimed to tackle a variety of issues and cut red tape. They include an action plan against benefit fraud and abolishing workers’ ability to obtain sick notes by phone, as well as a goal to cut staffing by 8% in federal ministries through digitisation.
The tax relief will be mainly funded by raising the top rate of tax to 47% from 45% for the highest earners with an annual income of €280,000 or more.
($1 = 0.8777 euros)
(Reporting by Andreas Rinke, Miranda Murray, Friederike Heine and Matthias Williams; editing by Thomas Seythal)
