Germany’s CDU, CSU, and SPD coalition has agreed on a transformative 34-point reform package to modernize the nation.

The CDU, CSU, and SPD coalition in Germany has finalized a comprehensive reform package aimed at modernizing the country, boosting the economy, and securing the future of the welfare state. Key measures include tax relief for millions of citizens starting January 1, with increases in basic allowances, child benefits, and adjustments to income tax progression. Small and middle-income families stand to benefit, while higher earners face stricter ‘wealth tax’ thresholds.

Other reforms address pensions, labor market flexibility, and healthcare. A timeline for pension reform legislation is set for 2026, while changes to sick leave rules and contract durations aim to enhance workforce adaptability. The coalition also plans to adjust tax policies for minijobs and reduce deductions for certain services. These measures reflect a balanced approach to economic growth and social equity.