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Merz Pushes Tax Reform Amid Union Opposition, AfD Surge

7/3/2026

26 6 Full Breakdown

Summary

Story summary

Chancellor Friedrich Merz pushed a sweeping reform package on July 2, 2026 despite low approval and a surge by Alternative for Germany.
The plan cuts €600 per year for a €60,000 family and raises the top rate to 45% above €250,000 and 47% above €280,000.
Trade unions Verdi and IG Metall opposed the certificate rule from day one of illness and the extension of fixed-term contracts.

History

Historical Context

In 2005 Gerhard Schröder’s Hartz IV reforms sparked nationwide protests and saw unemployment rise to over 5.2 million in February, before declining. The same fiscal-tightening logic reappeared in 2026 when Friedrich Merz proposed trimming €600 for €60,000 families and raising top rates to 45% and 47%, prompting opposition from unions Verdi and IG Metall.

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Story summary

Chancellor Friedrich Merz pushed a sweeping reform package on July 2, 2026 despite low approval and a surge by Alternative for Germany.
The plan cuts €600 per year for a €60,000 family and raises the top rate to 45% above €250,000 and 47% above €280,000.
Trade unions Verdi and IG Metall opposed the certificate rule from day one of illness and the extension of fixed-term contracts.

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