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German coalition agrees tax cuts

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German coalition agrees tax cuts


German Chancellor Angela Merkel’s conservative CDU party has sealed a coalition deal with the Free Democrats, the FDP.

The agreement paves the way for a new centre-right government to take office next week committed to pressing ahead with 24 billion euros in tax cuts despite a huge budget deficit. The FDP’s leader, Guido Westerwelle, has been appointed foreign minister. He said: “We want to reduce taxes and dues for families. We will start directly on January 1 of next year. We want to achieve major tax reform and for this reason we are very pleased to have decided on a new tax structure and an accordant rank tariff as part of the coalition treaty”. Both parties thrashed out who should get what cabinet posts during talks that went on long into the night. In a surprise move, security hardliner, CDU veteran, 67-year-old Wolfgang Schauble switches from the interior ministry to become finance minister. Karl-Theodor zu Guttenberg, a 37-year-old rising star from Bavaria gets the defence portfolio. But the youngest member of the cabinet is Phillip Roesler, aged 36, Germany’s first ever Asian-born member of the cabinet. Roesler, a Vietnamese refugee, was adopted by German parents when he was nine months old

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