Austria’s ÖVP, SPÖ, and NEOS continue heated negotiations to form the nation’s first “traffic light” coalition government, with sharp disagreements threatening progress. Despite public assurances of a “constructive atmosphere,” a leaked document reveals over 60 unresolved issues, particularly on fiscal and social policy.
The SPÖ demands revenue-based solutions to fix state finances, proposing taxes on wealth, inheritances, and windfall profits from banks and energy firms. ÖVP leader Karl Nehammer has firmly rejected new taxes, favoring expenditure cuts instead—a stance supported by NEOS. An SPÖ strategist countered, saying, “Economic experts agree revenue-side measures are unavoidable.”
Labor costs remain a sticking point, with ÖVP and NEOS advocating cuts in non-wage labor expenses, a move opposed by SPÖ unions who argue companies should bear the burden.
However, some progress has been made. Agreements include a headscarf ban for girls under 14, mandatory community service for asylum seekers, and ankle monitors for security threats. The SPÖ also secured backing for universal child welfare and faster access to public healthcare. Still, their proposal to freeze rents until 2027 remains blocked.
NEOS continues to push for structural reforms like federalism changes and Sunday store openings but faces resistance. Frustrations are growing among negotiators, particularly NEOS, over the lack of bold initiatives.
As talks extend into January, time is running out to reconcile divisions and deliver meaningful reforms, leaving Austria’s coalition talks in precarious balance.
