“I cannot confirm the assumption that an electricity tax reduction could be financed permanently”

Federal Finance Minister Lars Klingbeil is open to a reduction in electricity tax for everyone as planned by Chancellor Friedrich Merz (CDU), but expresses doubts about its affordability. The SPD politician said in Berlin that he had nothing against this political demand. But it also has to be able to be financed. Klingbeil added: "We are pleased that growth is back. But I cannot confirm today the assumption that this would enable a permanent electricity tax cut to be financed."

Merz had recently announced that the CDU wanted to work in government to reduce electricity taxes for everyone to the European minimum. There could be scope for this if growth solidifies and becomes more stable. The Union and SPD had agreed on the reduction for everyone in the coalition agreement, but initially only implemented it for some economic sectors.

The consumer advice centers said it was high time for the CDU to address the increased cost of living. Especially with a view to the heating season, the high energy costs are putting many people under pressure. The German Chamber of Commerce and Industry warned that it was crucial that words were quickly followed by actions. When it comes to the burden, every month counts for the company.

After the low blows for his CDU in the recent state elections, Chancellor Friedrich Merz focused on relief. “We have to work our way out of a low point, including a crisis of trust,” said the party leader after a CDU presidential meeting in Berlin. Any leeway in the budget should now be used to reduce electricity taxes for everyone to the European minimum, as originally promised by the black-red coalition. However, this has so far only been implemented for certain economic sectors.

Merz said: “We not only want to provide relief, but we also want to close the credibility gap that this decision resulted in for all of us last year.” There could be room for maneuver if growth solidifies and becomes permanent. The Chancellor pointed out that the government's growth expectations for 2026 had been raised from 0.5 percent to 1.3 percent. One percent growth means around ten billion euros in higher tax revenue, five billion of which go to the federal government.

The two-day presidential retreat was scheduled after the CDU's defeats in the state elections in September, which plunged the party into an acute crisis. In Mecklenburg-Western Pomerania, the CDU failed to enter a state parliament for the first time in its history. In Berlin it was pushed out of first place by the Left, which is now trying to form a government with the SPD and the Greens. In Saxony-Anhalt, the CDU lost almost 20 percentage points.

At the federal level, too, the Union has sunk to unprecedented depths. In several surveys, 17 months after the black-red government was sworn in, it is below 20 percent - compared to 28.5 percent in the election at the beginning of 2025. It was just six years ago that it reached around 40 percent in surveys. This now also put Merz personally under internal pressure.

Against this background, the Presidium decided on a six-page statement entitled “What must happen now”. It says: "The recent election results were a clear warning signal for the Union. Germany expects us to change something. We accept this task. Not with personnel debates, but with consistent policies."

Merz said that the discussions were characterized by great seriousness and “great mutual trust”. The CDU - and he does not exclude himself - has obviously not managed to combine the federal government's reform efforts and the associated long-term improvements with a positive future perspective for large sections of the population.