Two deputies in Germany's ruling Social Democrats, who were quoted in newspapers as expressing doubts over a plan by Finance Minister Mr Hans Eichel to free sales of industrial shareholdings from tax, have insisted that they back the move.

"The new regulation favours efficient companies, facilitates investments in the German economy and thus leads to more growth and employment," SPD parliamentarians Mr Joachim Poss and Mr Jorg Otto Spiller said in a joint statement. Under the plan, sales of shareholdings in domestic companies, which currently attract around 50 per cent tax, would be tax-free from 2001.