BERLIN, Nov 15 (Reuters) - German Chancellor Angela Merkel's conservatives plan to promise voters substantial income tax cuts following next year's federal election, a senior member of her party told a German newspaper.
Ronald Pofalla, general secretary of Merkel's Christian Democrats (CDU), told the Rheinische Post that the party would make clear at its congress in Stuttgart early next month that Germans deserved tax relief after years of budget consolidation.
"The consolidation of the budget is necessary but it must be linked to the goal of giving citizens and families in Germany more take-home pay," Pofalla told the Saturday edition of the newspaper.
"We will ensure that higher salaries and additional work are not minimised by cold progression, but rather that employees enjoy the fruits of their labour," he added.
Cold progression refers to the process by which taxpayers are pushed into higher tax brackets even if their real incomes have not grown. This occurs in Germany because tax brackets are not adjusted automatically for inflation.
Merkel has ruled out tax cuts during the current legislative period, which runs until September 2009, focusing instead on bringing down the German budget deficit.
But the global financial crisis and an economic downturn in Germany has forced her party to consider steps to alleviate the burden on average Germans.
The CDU will hold a party congress in Stuttgart from Nov. 30 to Dec. 2, where it will lay out the foundations of its election platform.
Merkel currently rules in an awkward "grand coalition" with the centre-left Social Democrats (SPD), but hopes to win enough votes in the next election to seal a new coalition with the liberal Free Democrats (FDP). (Writing by Noah Barkin; Editing by Charles Dick)