BERLIN German Finance Minister Wolfgang Schaeuble said in an interview published on Wednesday he would propose moderate tax cuts for low- and middle-income earners after an election in September.
Schaeuble is a member of Chancellor Angela Merkel's conservatives who have made security and tax relief a main component of their campaigning platform and are ahead in the polls of their Social Democrat (SPD) junior coalition partners.
The centre-left SPD have said they want to reverse some labour market and social welfare reforms that hurt the poorer sections of society most and want to boost investment on infrastructure.
"We want moderate tax relief," Schaeuble told public broadcaster ZDF, rejecting the idea of new debt as this would breach his cherished balanced budget. "Therefore we also don't have unlimited flexibility to cut taxes."
Schaeuble has said the tax cuts would amount to some 15 billion euros ($15.92 billion) a year, which economists says is too little to boost private consumption.
The Organisation for Economic Co-operation and Development (OECD) says Germany has the second-highest tax burden of all industrialised countries.
(Reporting by Gernot Heller; Writing by Joseph Nasr; Editing by Andrew Heavens)