German Chancellor Calls for Reform of Social Welfare Expenditures
This Saturday (August 23), German Chancellor Merz (Friedrich Merz) called for reform of Germany's social welfare expenditures, but simultaneously ruled out the possibility of increasing taxes on small and medium-sized enterprises.
He said: "With our current level of economic output, we can no longer sustain the existing welfare state system."
Due to rising costs and a federal budget shortfall, the coalition government's Social Democratic Party (SPD) had previously agreed to reform the social insurance system. This system covers health insurance, pensions, and unemployment benefits.
Merz acknowledged that cutting social benefits is not easy for the center-left SPD, but he called for both sides to cooperate in advancing the reforms.
At the same time, he emphasized that his federal government "will not increase corporate income tax on Germany's small and medium-sized enterprises." Previously, Deputy Chancellor and SPD Chairman Klingbeil (Lars Klingbeil) had stated that it was not ruled out to increase taxes on high-income individuals.
Klingbeil also called for social welfare reform, but emphasized the need for "creative solutions" rather than simply cutting workers' benefits.
On August 22 local time, official data released by the German Federal Statistical Office showed that Germany's gross domestic product (GDP) fell by 0.3% in the second quarter of this year, further revised from the previous estimate of a 0.1% decline in July.
Merz said that the difficulty of addressing Germany's current economic challenges is far greater than he initially expected. "I say this with a sense of self-criticism; this task is more or less much more difficult than we could have imagined a year ago. We are not only in a period of economic weakness, but also in an economic structural crisis."
Original: www.toutiao.com/article/1841501666089996/
Statement: This article represents the views of the author himself.