(de-news.net) – German business groups have intensified pressure on the Federal Government to accelerate labor, pension, and tax reforms, while Chancellor Friedrich Merz (CDU) defended plans to restructure retirement financing without reducing statutory pensions. At the same time, Berlin Mayor Kai Wegner (CDU) called for a renewed wealth tax focused on high-net-worth individuals, alongside broader tax relief for workers and medium-sized businesses.
Labor Minister Bärbel Bas (SPD) has faced renewed calls for a more reform-oriented course from the Confederation of German Employers’ Associations, amid intensifying debate over labor-market policy, pension financing, and economic competitiveness. Steffen Kampeter, the organization’s managing director, argued that the SPD co-chair should move beyond delaying major policy decisions and instead begin implementing concrete reforms. In particular, he stressed the importance of rapidly introducing legislation designed to stabilize the financing of Germany’s pension system without further increasing labor-related costs for employers and employees. Kampeter also underlined the urgency of modernizing the country’s working-time regulations, presenting the planned revision of labor laws as an important component of broader economic and structural reform efforts.
At the same time, the German Chamber of Commerce and Industry intensified pressure on the Federal Government to accelerate its planned corporate tax reform agenda. The organization called for the measures to be brought forward by one year, with implementation beginning in 2027 rather than at a later stage. Helena Melnikov, the chamber’s chief executive, reportedly explained that the corporate tax reductions already approved by policymakers should be introduced in two stages instead of being spread over a five-year timetable. According to the business organization, a faster rollout would provide companies with earlier relief and strengthen economic momentum at a time of persistent uncertainty and weak growth. The demands were issued shortly before senior representatives of the SPD as well as the CDU/CSU alliance were scheduled to convene at the coalition committee meeting in the Chancellery later that evening.
Speaking at the congress of the German Trade Union Confederation in Berlin, Chancellor Merz once again called for a far-reaching restructuring of Germany’s statutory pension system. He warned that, without substantial reform, the long-term sustainability of the existing pension framework could not be guaranteed. Merz portrayed the proposed measures not as a threat to social protections, but rather as an opportunity to strengthen funded retirement provisions alongside the statutory system. Central to the government’s approach, he argued, was a rebalancing of the three traditional pillars of retirement security — public pensions, occupational pensions, and private retirement provision — in order to adapt the system to demographic and economic pressures. At the same time, the chancellor emphasized that no reductions to statutory pensions were being considered and stated that the Federal Government intended to make the necessary policy decisions during the summer months.
DGB calls for fair burden-sharing
Yasmin Fahimi, chair of the German Trade Union Confederation, argued that Germany was currently experiencing a period of profound economic and social transformation. Against that backdrop, she insisted that the financial and social burdens associated with the planned reforms should be distributed fairly across society. Her remarks reflected broader concerns within organized labor that structural reforms must preserve social balance and avoid placing disproportionate pressure on lower- and middle-income groups.
Berlin Mayor Wegner also intervened in the broader fiscal-policy debate by arguing that the reintroduction of a wealth tax had effectively become unavoidable. In his assessment, Germany required a comprehensive package of measures combining tax reform, subsidy reductions, and a larger contribution from wealthy individuals under the principle of social solidarity. Wegner maintained that some form of renewed wealth levy would ultimately be necessary in order to ensure that the country’s wealthiest citizens contributed more significantly to public finances and the broader social system.
At the same time, the Berlin Mayor stressed that any broader tax reform effort must also provide meaningful relief for ordinary households. Referring to the sharp rise in food prices and broader living costs, he argued that many citizens were increasingly struggling to finance routine weekly grocery purchases. Although Wegner did not identify specific income thresholds for higher tax rates, he cautioned against placing additional burdens on skilled workers, tradespeople, and medium-sized businesses. He argued that economic achievement and labor should continue to be rewarded and maintained that skilled craftsmen and small business owners — including master bakers and comparable professions — should not be pushed into the highest income-tax bracket. Instead, he contended that the primary focus of future tax measures should remain on top earners and individuals possessing exceptionally large fortunes, who, in his view, should assume a greater share of the financial burden.
Under Article 106 of Germany’s Basic Law, revenue generated from a wealth tax would accrue to the country’s Federal States. However, the tax has not been collected since 1997, when the Federal Constitutional Court of Germany ruled that the valuation method used at the time was unconstitutional. The court’s decision effectively suspended the tax, leaving successive governments to debate whether and in what form a revised wealth-tax framework could eventually be reintroduced.
Audio: TTSFree
