BERLIN - Chancellor Angela Merkel vowed yesterday to have a new center-right German government in place by Nov. 9, when Germany marks 20 years since the fall of the Berlin Wall. She said tax cuts were possible in 2011 but rejected spending cutbacks that might strangle an incipient economic recovery.
Voters Sunday ended the conservative Merkel’s right-left “grand coalition’’ and gave her a comfortable center-right majority - thanks to a strong performance by her new government ally, the business-oriented Free Democrats.
“Germany is entitled to have a new government quickly,’’ Merkel said, noting that the country is just emerging from a deep recession. Merkel later met for an hour with the Free Democrats’ leader, Guido Westerwelle, whose party gave no details of what they discussed.
Germany plans a state ceremony to mark the wall anniversary on Nov. 9, and Merkel said she would like to “greet [foreign] heads of government on Nov. 9 with a new government.’’
Sunday’s election outcome nudged Europe’s biggest economy to the right but, with the cautious, consensus-seeking Merkel still in charge, it appeared unlikely to produce a radical lurch in economic policy.
A key plank of Merkel’s campaign was a pledge to offer moderate middle-income tax relief. The Free Democrats want a more radical overhaul of the tax system, cutting the top and bottom income tax rates considerably.
Westerwelle said his party will push for a fair tax system.
Merkel said possible tax cuts could be implemented starting in 2011 or 2012, but gave no details of what they might look like. She argues that cuts would stimulate economic growth and ultimately improve tax revenues.
Merkel’s center-left rivals, the Social Democrats - her partners in the outgoing coalition - argued it was a bad idea to cut taxes when the government has run up substantial debts to combat the economic crisis.