Seehofer, the leader of the Bavarian sister party to Merkel's CDU, said the German government was performing a "creeping" change to its open-border refugee policy.
"The federal government has completely changed its refugee policy, even if it does not admit that," he told the newspaper Bild.
"There has been a creeping withdrawal from the unconditional welcoming culture," he added.
"Despite the images from the Greek-Macedonian border no German politician today says: "'The borders are open, let everyone come to Germany.' "
Seehofer said the number of refugees and migrants entering Germany was only decreasing because of the actions taken by Austria and other nations along the so-called Balkan route, nothing that "other countries are doing our job."
"Germans are the main beneficiaries from the actions of Austria and the Balkans."
Seehofer: Germany Needs Refugee Cap
In a direct contradiction to Merkel's position on the matter, Seehofer said Germany should be "grateful" for the actions of Balkan nations in imposing border controls, but warned that it was not a "permanent solution."
"If a common European solution does not work, we must act nationally — as all countries along the Balkan route do."
Once again in defiance of Merkel and central government in Berlin, Seehofer raised concerns over the recent EU-Turkey refugee deal, calling for Germany to put forward a national approach to the migration crisis, including proposals for an annual cap of 200,000 refugees.
Why we are concerned about draft EU-Turkey plan https://t.co/DXvfpu4DUY pic.twitter.com/uwLpg9LQIi
— UN Refugee Agency (@Refugees) 21 March 2016
"All countries except Germany have already been practicing the policy of caps. Decreasing number of refugees is the result [of this policy]," Seehofer said.
Last year, Germany accepted about 1.1 million refugees and migrants from war-torn countries as part of Germany's so-called 'open doors' policy.
The huge numbers of new arrivals led to calls for the government to change its stance and reduce the flows of people into Germany, with widespread anti-government protests targeted against Chancellor Angela Merkel.
While a number of government officials and other politicians have spoken positively about the newly negotiated EU-Turkey refugee deal, others are far more skeptical, arguing that it is merely a short-term solution to a much broader regional problem.
Meanwhile, other critics remain concerned about the legality of the deal, arguing that returning refugees back to Greece would be against humanitarian law and the international right to asylum.