Germany's Merz Unveils Major Reform Package to Revive Economy

Email: online@newsofbahrain.com

Berlin: German Chancellor Friedrich Merz on Thursday introduced a sweeping 34-point reform package intended for rejuvenating Europe's largest economy, boosting competitiveness and easing the burden on households and businesses. Despite decreasing GDP and rising economic concerns, the government hopes to pass the crucial law before the end of the year.

The plan contains €10 billion in annual tax breaks for low- and middle-income households, which is partially funded by hiking the top income tax rate for the highest incomes from 45% to 47%. It also suggests pension reforms such as raising the retirement age gradually, increasing labour market flexibility, reducing bureaucracy, enforcing sick leave laws, and steps to assist affordable housing, clean technology, artificial intelligence, and semiconductor businesses.

Business groups and many experts welcomed the initiatives as a timely effort to rebuild Germany's economy, but labour unions condemned proposed changes to workers' rights and pension regulations. The offer comes as Merz's coalition struggles to maintain popular support and restore confidence in Germany's economic future.