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BERLIN May 8 The German government surprised
with a slightly lower tax revenue estimate for 2014 on Thursday,
which Finance Minister Wolfgang Schaeuble said left Germany no
financial leeway to cut taxes as it prioritises budget
The ministry's panel of tax experts put this year's tax take
at 639.9 billion euros, down 400 million euros from the last
estimate in November, but some 20 billion euros higher than
2013's take. The panel expects tax revenue for the years 2014 to
2018 to total 3.448 trillion euros.
"The tax estimates do not create any new room for manoeuvre
financially. From 2015 onwards we want to manage without any new
debt," Schaeuble told a news conference.
Record tax revenues have triggered calls from some within
Chancellor Angela Merkel's conservatives to overhaul the
mechanism of so-called "cold progression", under which income
tax brackets are not adjusted for inflation. The finance
ministry ends up taking in billions of euros in extra revenues
as a result.
Their Social Democrat coalition partners don't object to an
overhaul itself, but have argued that tax on higher earners
should be raised to compensate for lost revenues. That, however,
would break an election pledge made by Merkel's conservatives
not to hike taxes.
Strong economic growth and a booming labour market have
boosted German tax revenues and projected future tax take.
(Reporting by Alexandra Hudson and Annika Breidthardt; Editing
by Madeline Chambers)