MUNICH, May 29 (Reuters) - The German government could partly abolish a controversial flat rate withholding tax on capital gains, Finance Minister Wolfgang Schaeuble said on Monday.
"We will be able to do that for interest income, but not for dividends," Schaeuble told an annual meeting of tax consultants in Munich.
Schaeuble, a senior member of Chancellor Angela Merkel's conservatives, also said that Germany and France would try to agree on a joint framework for corporate taxation and that a joint solution for value-added tax was needed in Europe.
The Social Democrats (SPD) also want to abolish the flat rate withholding tax on capital gains so that income from labour and capital will be taxed equally in the future.
Introduced in 2009 by former SPD Finance Minister Peer Steinbrueck to help fight tax evasion to countries like Switzerland and Luxemburg, withholding tax is charged at 25 percent on private income from capital gains. That is a lower rate than many workers pay in income tax, which is charged at progressive rates of up to 42 percent. (Reporting by Joern Poltz; Writing by Michael Nienaber; Editing by Michelle Martin)