German Coalition to Take Up Tax Relief as Reform Deadline Nears

Chancellor Friedrich Merz’s coalition will attempt to overcome deep differences over a sweeping reform agenda in talks Wednesday as parties turn to a plan for a broad tax cut alongside potential hikes for higher earners.

Merz’s Christian Democratic-led bloc and the Social Democrats meet with representatives of employers and labor unions in Berlin as the coalition bears down on a self-imposed deadline to unveil a program of changes to Germany’s health, tax and pension systems by the parliamentary summer recess, which starts July 11.

“My hand is extended,” Social Democratic co-leader Lars Klingbeil, Merz’s finance minister and vice ...