Many have assumed that because Martin Luther opposed the Catholic doctrine of the sacraments and championed the Protestant doctrine of justification by faith, he must have been the one who rejected baptism as a salvation event. Nothing could be further from the truth. Luther’s view of the meaning of baptism stands in direct continuity with the New Testament, the early church fathers, and the Catholic scholars who preceded him. He regarded baptism as a might work of God in which the Father, Son and Holy Spirit pour out the full blessings of salvation upon penitent believers.
Specifically, Luther asserted that forgiveness of sins is initially bestowed in baptism. In his Small Catechism (IV:6), in answer to the question “What gifts of benefits does baptism bestow?” he says first of all, “It affects forgiveness of sins.” This is part of the work of baptism; in it “the forgiveness takes place through God’s covenant” (The Holy and Blessed Sacrament of Baptism, 15).
Forgiveness takes place in baptism because that is where the blood of Christ is applied to the sinner: “Through Baptism, he is bathed in the blood of Christ and is cleansed from sins” (E. Plass, editor, What Luther Says 1:46).
According to Luther, baptism brings not only forgiveness of sins but also a new birth, a change in the inner man that actually eradicates sin. For “it is one thing to forgive sins and another thing to put them away or drive them out… But both the forgiveness and the driving out of sins are the work of baptism (The Holy and Blessed Sacrament of Baptism 15). Thus it is appropriate to speak of baptism as the time when “a person is born again and made new” (ibid, 3).
In short, Luther clearly proclaimed that baptism is for salvation: “Through baptism man is saved (ibid, 6). In answer to the question of the purpose of baptism, i.e. “what benefits, gifts and effects it brings,” he gave this answer: “To put it most simply, the power, effect, benefit, fruit and purpose of Baptism is to save” (The Large Catechism IV:23,24). One is baptized so that he “may receive in the water the promised salvation” (ibid, IV:36).