Germany says scope for tax cuts limited

BERLIN: German Finance Minister Wolfgang Schaeuble rejected demands on Saturday from some fellow conservatives for large tax cuts after a September election, saying there was only scope for about 15 billion euros in reductions.

Schaeuble, whose priority is maintaining a balanced budget in Europe´s biggest economy, told Badische Neueste Nachrichten newspaper that deeper tax cuts would require new debt.

Some members of Chancellor Angela Merkel´s Christian Democrats (CDU) want to see tax cuts of about 30 billion euros.

But Schaeuble said Germany needed to ensure it had sufficient financial resources to spend on security, infrastructure, the integration of migrants and research.

"Citizens always gain most from very good economic developments and job security," he told the paper.

"Wages are rising, pensions, too.

That benefits people. Polls ahead of the Sept. 24 election point to a tight race between Merkel´s conservatives and her junior coalition partners, the centre-left Social Democrats (SPD).

Schaeuble, gearing up for a G20 finance ministers meeting in Germany at the end of next week, also once again brushed off criticism from the U.S. government about Germany´s trade surplus.

"We invest a big part of our surpluses in other countries and contribute economic growth and job creation there, also in the United States," Schaeuble was quoted as saying.