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German Chancellor Friedrich Merz unveils comprehensive reform package to boost economy
AP News • • world
Key Points:
- German Chancellor Friedrich Merz and coalition partners unveiled a 34-measure reform package aimed at revitalizing Germany's sluggish economy, including income tax cuts for low- and middle-income families, pension system overhaul, stricter sick leave rules, and bureaucracy reduction.
- The tax cuts are projected to provide an annual relief of about 600 euros for an average family by 2028, totaling approximately 10 billion euros in annual tax relief, while pension reforms will gradually raise retirement age aligned with life expectancy to stabilize the system.
- New sick leave regulations will require employees to provide a doctor’s certificate from the first day of absence, addressing concerns over high sick leave rates impacting productivity.
- The reform package also targets reducing bureaucratic burdens by eliminating various reporting requirements and easing data protection to the European minimum standards.
- The far-right Alternative for Germany party criticized the reforms as insufficient and left-leaning, while Chancellor Merz urged citizens to support the package to ensure Germany's economic future.
