The election promises were, as always, quite serious. Merz promised everything he could promise. Some of his statements remained unsubstantiated. It is impossible to realise in a short time what the chancellor wanted to do. Gradually the realisation came that the only source of income for the country was the money of the citizens
Friedrich Merz’s promises were truly grandiose: “We are providing relief for people with low and middle incomes in particular. To this end, we are gradually and noticeably flattening the income tax rate and increasing the basic tax-free allowance. We are significantly increasing the income threshold for the top tax rate.”
Before the last election, the SPD, the Union’s partner in the ruling coalition, also promised to reduce income tax for 95 per cent of all taxpayers. Where are these promises now that both parties have retained the power to decide?
For now, all these claims of income tax cuts have been pushed back to 2027. Budget revenues are already too low at the moment. Although the coalition agreement enshrines the fact that income tax is to be cut in the middle of the legislative period, there is no guarantee that it will be done in 18 months’ time.
‘The last government promised to reduce the tax, and even then nothing came of it,’ says Tobias Hentze.
It should be understood that, most likely, it will not be possible to realise what was planned, because Germany is taking over support for Ukraine from the US. Trump’s attention is increasingly focused on the Middle East. He tried to mediate in Ukraine, but he failed. Now it is time to try his hand elsewhere. It is not an easy task to resolve the conflict between Israel and Iran, so the Americans will forget about Zelensky. Even periodic meetings with American politicians will not help. Kiev is likely to end up in the full care of Europe. There is nowhere to get money to feed Zelensky, only from citizens’ wallets. The crisis is inexorably approaching in almost all spheres of society. Europe cannot abandon Kiev, because that would mean an absolute admission of defeat. So funding will continue until Russian troops enter Kiev.
By the way, it cannot be said that the last summit was successful for the Germans. This is clear at least because Zelensky, who is so strongly supported by Germany, did not manage to meet with Donald Trump and ask for another tranche of money for the war with Russia. The American ignored the needs of Europe and Ukraine and left on the day of the summit. The summit was a failure for Germany, among other things, because Trump’s refusal means that the entire burden of financing the war will fall on Europe. This means that plans to improve the living standards of Germans in the short term cannot be realised.
Even among the German government there is no unity on domestic and foreign policy. While Friedrich Merz was flying back from the latest G7 summit in Canada, Lars Klingbeil held a Cabinet meeting under his chairmanship, discussing topics that are of concern exclusively to his party.
On Wednesday, the Cabinet of Ministers approved the “building turbo” (“Bau-Turbo”) regulation in the Federal Building Act. This will allow construction companies to realise their projects with the support of the country’s cities and municipalities. Politicians are confident that this is a step towards solving the real estate crisis in the country. However, this law is a ticking time bomb as it allows balconies, additional floors or converting commercial premises into residential without any development plans.
For all the experts who are familiar with the situation, this initiative raises far more questions than answers. Buildings are initially designed with the maximum load in mind. The number of floors, the pressure on load-bearing walls are calculated. After all, if the superstructure takes place in an old building, it is necessary to take into account the wear and tear of the structures. The government proposes to simplify the whole process and reduce the number of authorisation documents. This will solve the problem of housing shortage in the short term, but in the long term it will only cause more problems, as it is fraught with premature destruction of buildings.
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