Pressure mounts on Chancellor Merz to deliver on core CDU promise as internal divisions sharpen.
A significant wave of internal pressure is building within the Christian Democratic Union (CDU) for party leader and Chancellor Friedrich Merz to fulfill a key election pledge: a reduction in electricity tax for all consumers. The Mittelstands- und Wirtschaftsunion (MIT, or Association of Medium-Sized Businesses and the Economy) and the Christlich-Demokratische Arbeitnehmerschaft Deutschlands (CDA, or Christian Democratic Work Association of Germany) are poised to introduce resolutions on the matter at the upcoming CDU party conference in Stuttgart on February 20th and 21st, signaling a potentially contentious debate and testing Merz’s leadership.
The MIT’s proposed resolution argues for a broader application of the electricity tax cut, extending its reach beyond current recipients to encompass private households, the commercial and service sectors and the entire crafts industry. The justification emphasizes the continued burden of elevated energy costs on German businesses, arguing those costs are increasingly non-competitive on an international scale. “It is therefore necessary to significantly reduce the state-imposed components of energy costs” the resolution states, positioning the tax reduction as a crucial economic imperative rather than a mere fiscal measure.
MIT Chairwoman Gitta Connemann articulated the organization’s stance, stating, “Energy costs are weighing down every medium-sized business. Whether it’s a bakery, retail shop, or tradesman, they are all struggling daily against cost pressures”. Connemann framed the proposed universal reduction as a vital step to unlock investment potential and safeguard jobs, asserting that retaining value creation within Germany requires relief for businesses. This position is not merely about financial ease, she argues, but a fundamental economic necessity.
However, the CDA’s perspective highlights a critical social dimension to the debate. Their proposed resolution focuses on the disproportionate impact of energy price increases on lower and middle-income households. Despite a recent stabilization, many remain burdened by higher living costs than in previous years. The CDA is therefore demanding a reduction in electricity tax across the board to the European minimum level before the end of this year, anticipating that this will also benefit the Mittelstand. This resonates with a desire to address growing social inequalities and demonstrates a potentially divergent approach to policy priorities within the CDU.
The convergence of MIT and CDA on this issue, despite their often contrasting stances – alongside the powerful Jungen Union (Young Conservatives) – lends considerable weight to the impending party conference. Their combined influence suggests the resolution has a high probability of adoption, forcing Chancellor Merz to confront a potential conflict between his own policy agenda and the demands of significant internal factions. The outcome could offer a significant insight into the evolving dynamics within the CDU and its approach to addressing both economic competitiveness and social equity.