Austrian chancellor pledges to cut taxes ahead of election

VIENNA (Reuters) - Austrian Chancellor Karl Nehammer on Monday vowed to cut taxes for lower-paid workers and for some bigger earners as he seeks re-election at the head of his conservative Austrian People's Party (OVP) next month.

Speaking barely a month before the Sept. 29 parliamentary election, Nehammer said he wanted to provide tax relief to the "broad centre" of working people in the country.

"That's why we want to start by reducing the entry tax rate from 20% to 15%," he told a press conference in Vienna, saying lower paid workers and pensioners would benefit most.

Nehammer also promised to scrap the second-highest tax bracket of 48%, and make overtime tax-free.

Annual incomes of up to 20,818 euros ($23,247) are taxed at 20% in Austria, with the rate increasing progressively for higher wages. Incomes of up to 12,816 euros are tax-free.

Latest opinion polls show Nehammer's OVP trailing the far-right Freedom Party (FPO) by a few percentage points, with the centre-left Social Democrats a close third.

Last week, the FPO presented its election manifesto, also promising tax breaks for certain sectors.

($1 = 0.8955 euros)

(Reporting by Paul Arnold; Editing by Alison Williams)

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