DPA/Berlin
Leaders of Germany’s centre-left Social Democratic Party (SPD) gave their approval yesterday to an election manifesto designed to win over voters with promises of more cash.
Key points of the 57-page programme are tax cuts and state handouts for low income groups and families with children, partly financed by a tax on the rich and a levy on stock transactions.
The SPD is seeking to distance itself from Chancellor Angela Merkel’s conservative Christian Democrats (CDU) as Germany’s two coalition partners gear up for a parliamentary election on September 27.
Campaigning is likely to be dominated by the fallout from the economic crisis, which has hit key sectors of German industry and put tens of of thousands of workers on reduced hours with less pay.
The SPD measures “are the right answer” to the unprecedented downturn, said Ralf Stegner, a member of the party’s 45-member executive, which unanimously endorsed the new platform.
The programme includes a four-point reduction in the lowest bracket of income tax to 10% as well as a 200-euro ($264) tax break for families with children.
There is also a 300-euro bonus for people on low wages and no additional income if they forgo filling in a tax return, a move the party says will also help cut red tape.
The measures will be counter-financed by a two-point increase in the top tax band to 47% for people on annual incomes of 125,000 euros upwards and a 0.5% levy on stock exchange transactions.
The party estimates these steps would generate 5bn euros in extra revenue, part of which would be used to improve educational facilities.
“We are providing relief to the centre by lowering the opening tax rate and by investing more in the education of their children,” said Foreign Minister Frank-Walter Steinmeier, the man chosen by the SPD to challenge Merkel for the chancellorship in September.
Steinmeier, who is due to unveil the election manifesto today, defended the planned tax increase for top earners, saying “strong shoulders have to bear more, particularly in times of crisis”.
The executive rejected a bid by the party’s left wing to include a demand for a wealth tax in the platform, which is due to be presented for approval to an SPD party congress in Berlin on June 14.
Merkel’s party has not yet disclosed its election programme. But her allies criticised the SPD measures and warned against a race to slash taxes ahead of the autumn polls.
Alexander Dobrindt, secretary-general of the CDU’s Bavarian ally, the Christian Social Union (CSU), called the SPD’s election platform a “non-starter”.
Guenther Oettinger, CDU prime minister of the southwest state of Baden Wuerttemberg, said: “I believe it wrong to enter a competition to cut taxes.
“It is implausible. At least in 2009 and 2010 it is not possible to finance them (tax cuts) in view of the high (government) deficit arising from the financial crisis.”
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