Germany's Schulz promises higher taxes for the rich
June 19, 2017 | 4:36 PM
by Reuters
Martin Schulz, chairman of Germany's social democratic SPD party, stands in front of his party's secretary general Katarina Barley (hidden) as they meet with the SPD leadership at the SPD headquarters in Berlin on March 27, 2017, one day after regional elections in the southwestern federal state of Saarland. In the Saarland state vote held six months before a general election, German Chancellor Angela Merkel's Christian Democrats (CDU) won 40,7 percent against 29,6 percent for the Social Democrats (SPD), according to preliminary official results. Photo - AFP

Berlin: Germany's Social Democrats (SPD), seeking to turn round their flagging election campaign, promised to raise the top income tax rate for the rich and abolish a flat-rate withholding tax on capital gains in a bid to win back working-class voters.

"We'll reduce the tax burden for small and medium-sized incomes and we'll support families," party leader Martin Schulz told reporters on Monday.

This step would help stimulate domestic demand and reduce Germany's trade surplus by sucking in more imports from other European countries, he added.

"Our proposal is good not just for Germany but also for Europe," Schulz added.

Schulz hopes to unseat Chancellor Angela Merkel, who is seeking a fourth term, in September 24 national elections.

But the centre-left SPD, currently junior partner in Merkel's ruling coalition, has lost momentum since making initial gains after nominating Schulz as the party's new leader in January.

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By unveiling its tax plans, the SPD wants to put the issue of social justice at the centre of the election campaign, though the topic has not weighed very heavily so far among voters.

Polls see a double-digit lead for Merkel's conservatives ahead of the SPD.

Schulz said the SPD would increase the top tax rate for employment income to 45 per cent from 42 per cent.

To avoid higher taxes for middle-class families, the SPD also wants to lift the threshold from which the top rate applies.

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