Despite holding a meeting for more than five hours late into Wednesday evening, the conservative CDU/CSU alliance and the centre-left Social Democrats (SPD) failed to come to an agreement on the issue.
However, last week the government announced that the tax would only be reduced for heavy industry and the agricultural and forestry sectors.
But CDU Chancellor Friedrich Merz and SPD finance minister Lars Klingbeil have justified the decision by pointing to budget constraints.
SPD Labour Minister Barbel Bas said on Thursday it was necessary “to set priorities”, telling the ARD TV station: “It is important as a first step to secure jobs, boost the economy and then see what room for manouevre we have.”
The current row raises the spectre of the recurrent arguments over spending that eventually brought down the previous government, an unwieldy three-party coalition under SPD chancellor Olaf Scholz.
The fall of Scholz’s government in November prompted an early general election in February, won by the CDU/CSU. – AFP
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