The move, which will still need parliamentary approval, follows the New Year's Eve attacks, which sparked outrage in Germany.
Victims described chaos as dozens of sexual assaults and robberies were carried out with little apparent response from the authorities around the city's main station.
Twenty-one people are being investigated for sexual assault.
Under the new plans, those on probation could be deported too.
"When crimes are committed, and people place themselves outside the law...there must be consequences," she told reporters after the meeting.
Under current German laws, asylum seekers are only forcibly sent back if they have been sentenced to at least three years, and providing their lives are not at risk in their countries of origin.
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