Berlin - German Chancellor Angela Merkel is to campaign for
re-election this September on a tax-cutting platform, after rebuffing
fiscal conservatives in her ruling party on Sunday.
Front-runner Merkel huddled in Berlin with 100 top figures in her
own Christian Democratic Union (CDU) and their Bavarian ally, the
Christian Social Union (CSU), to sign off on campaign policies.
The chancellor flatly rejected calls to increase Germany's sales
taxes to offset income-tax cuts.
'I will not increase value-added tax (VAT) in the life of the next
parliament,' she said bluntly after the meeting. 'Right now we don't
need sacrifices, we need moderate cuts.'
Merkel loyalists slapped down calls from two state premiers,
Guenther Oettinger of Baden Wuerttemberg and Wolfgang Boehmer of
Saxony-Anhalt, to frankly tell the public about sacrifices needed to
finance any tax cuts.
Neither maverick premier showed up for the meeting in Berlin of
the two parties' central boards.
As the recession cripples some of Germany's biggest companies,
much of the centre-right has concluded that the run-up to the
September 27 poll is no time to press longtime CDU demands to balance
Germany's budget.
The two parties unanimously adopted a 60-page document setting out
the joint CDU/CSU policies this September, including tax cuts for the
poor and middle class and government support for renewable energy.
Merkel left the date of her planned tax cuts vague, rejecting
pressure from the CSU's populist leader, Bavarian Premier Horst
Seehofer, to commit to implementing the cuts in 2011.
The chancellor aims to break out of an uncomfortable coalition
with the centre-left Social Democratic Party (SPD) and form an
alliance after the election with the pro-business Free Democratic
Party (FDP).
Merkel and Seehofer said the FDP was the coalition partner they
preferred.
The SPD, which is seeking to increase taxes on the well-off, has
suffered a slump in public support.
Seehofer, who has sometimes chafed with the CDU in the past,
declared 'full support' for Merkel's re-election and assailed the
ideas of premiers Oettinger and Boehmer as 'incredible.'
Analysts said Merkel was determined to avoid a political misstep
by the CDU in 2005, when fiscal conservatives in the party insisted
the public needed to know where the money for tax cuts would come
from.
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