Schaeuble open to German income tax relief to spur consumer demand
April 28, 2014, 12:05 am TWN
BERLIN--Germany's powerful Finance Minister Wolfgang Schaeuble said Sunday he was open to cutting income taxes, as international partners call on Europe's top economy to spur consumer demand.
Schaeuble told the upcoming issue of Der Spiegel magazine that if a compromise can be reached within Germany's left-right "grand coalition" government while respecting fiscal discipline, he would be willing to look at tax relief.
The latest calls for reform target a quirk of the German system known as "tax bracket creep" under which employees who get pay rises slip into higher tax groups, making their net pay lower than before.
"If there is room to maneuver in the budget and a shared desire by our coalition partners to tackle tax bracket creep then I am the last one who will stand in the way," Schaeuble told Spiegel.
Spiegel said earlier calls by the co-ruling Social Democrats to finance such a move with a tax hike on earners in the highest bracket were now off the table and would likely be replaced by measures to close tax loopholes.