Merkel and the CDU have said the number of refugees in Germany would be reduced through smart policies. But Germany's doors remain open despite the huge influx this year.
Nearly 1.1 million refugees and migrants registered in Germany in 2015, a number five times more than last year, Bavaria's social minister Emilia Müller said on Wednesday.
Most of the refugees arrived first in Bavaria after making their way from the war-torn Middle East through the Balkans and on to Germany.
Some 160,000 refugees have stayed in Bavaria, while the rest have been distributed across Germany's 15 other federal states.
The refugee crisis has created the divisions between Chancellor Angela Merkel's Christian Democratic Union (CDU) and its Bavarian sister party, the CSU.
The CSU is pushing for tighter border controls and upper-limits, "because Germany cannot shoulder this number of arrivals forever," Müller, a member of the CSU, said.
On Wednesday the CSU put forward a controversial proposal to turn back refugees without documents or passports. So far the CDU has shot down the idea, despite rising concern in Europe over jihadists infiltrating among refugees to carry out terrorist attacks.
Merkel's CDU has opted for an open Germany, policies to strengthen EU borders and keep refugees in Turkey, while calling for Europe to embrace a distribution scheme that would help share the burden across EU member states. These measures, it is believed, would help reduce the influx of refugees to Germany.
The cost of hosting refugees in Germany, many of which may stay permanently, is estimated at some 17 billion euros ($18.5 billion) next year. The refugee influx has tested housing, education and social services as authorities scramble to register and integrate refugees.
Germany has received more migrants than any other EU member state, including significant numbers of economic migrants fleeing poverty and unemployment in Kosovo, Albania and Serbia earlier this year.
To give priority to refugees fleeing conflict, the government has warned economic migrants from the Balkans that they are unwelcome and will be deported.
The number of refugees arriving to Europe by sea topped the symbolic 1 million number, the UN refugee agency said on Wednesday.
Of those arriving by boat, 844,176 landed in Greece and another 152,700 in Italy. Spain and Malta combined had fewer than 4,000 arrivals.
Some 49 percent of arrivals in the EU came from Syria and 21 percent from Afghanistan. Iraqis and Eritreans also make up a significant portion of arrivals.
cw/jil (AP, dpa, KNA)