Does Germany agree on forming coalition government?

German Chancellor Angela Merkel’s conservatives and the Social Democrats (SPD) agreed after all-night talks on Friday to a blueprint for formal coalition negotiations.

After 24 hours of talks, the six leaders began presenting the 28-page blueprint to party members, party sources said.

According to a source involved in the negotiations, the two sides had agreed not to raise taxes if they form a governing alliance.

"We agree on the aim of a balanced budget without new debt," Reuters cited a draft of a coalition blueprint as saying.

The blueprint showed they wanted to gradually abolish the ‘solidarity tax’ introduced after reunification in 1990 to support poorer eastern states.

Weakened by an election setback in September, Merkel turned to the left-leaning SPD to renew their so-called 'grand coalition' after the collapse in November of talks on a three-way coalition with the Greens and Free Democrats (FDP).