New immediate program: Coalition brings momentum to Germany's economy!

New immediate program: Coalition brings momentum to Germany's economy!

Today, May 28, 2025, the first coalition committee of the CDU, CSU and SPD meets in Berlin. The new black-red coalition has set itself ambitious goals to relieve the burden on the economy and tackle key reform projects. Chancellor Friedrich Merz (CDU) has announced an “immediate program” with several dozen points. The first decisions should be made by the summer holidays. The coalition is planning a number of concrete measures, including better tax depreciation options and a comprehensive reduction in bureaucracy.

Another focus is on the creation of a special fund of 500 billion euros that will be used for infrastructure and climate protection. These measures are considered necessary to overcome the economy's weak growth. Merz emphasizes that Germany is facing historic challenges and the coalition wants to address them quickly. Over the past two years, the country has struggled with economic setbacks and only stagnation in gross domestic product is expected in 2025.

Planned relief and reforms

The coalition committee plans, among other things, to increase the commuter allowance and reduce the VAT for food in restaurants from January 1, 2026. The approval of the states in the Bundesrat is crucial, despite possible resistance. Merz also points out the planned relaxation of the debt rules for the federal states and emphasizes the shared responsibility for Germany's economic stability.

The voices in the coalition are optimistic. SPD leader Lars Klingbeil speaks of the government's positive pace, while CSU chairman Markus Söder addresses the growing confidence among the population and emphasizes that quick results are necessary. The coalition agreement already contains announcements such as a reduction in electricity taxes to counteract the economic pressure on companies and citizens.

Structure of the coalition committee

The coalition committee meeting will take place at least once a month to discuss fundamental issues. There are ten men and one woman on this committee, which has already sparked criticism from the public. In order to overcome the challenges ahead, several expert commissions will also be set up to reform the debt brake and federal electoral law.

Business associations in particular are expressing concern about the current conditions, such as high energy costs, rising taxes and long approval processes, which are putting a heavy burden on companies. The introduction of an “investment booster” in the form of declining depreciation to promote business investment is seen as a further step in the right direction.

The initial measures are part of a comprehensive approach to address the country's difficulties and restart the economy. The coming weeks will show whether the coalition will be able to actually implement its plans.