Under fire German ruling coalition unveils reform package

BERLIN - German Chancellor Friedrich Merz's ruling coalition unveiled a package of reforms on Thursday, including €10 billion ($11 billion) in tax relief for lower income earners, changes to the pension system and building more affordable housing.

Trailing in opinion polls behind the far-right Alternative for Germany party, Merz has faced heavy pressure to pass reforms to revive Europe's largest economy but has struggled to overcome internal coalition wrangling and gain momentum.

"We want to get Germany back on track," Merz told reporters on Thursday.

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(Reporting by Miranda Murray and Matthias Williams, editing by Thomas Seythal)

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This story was originally published July 2, 2026 at 3:25 AM.