Expansion / “The next Government will be able to make a budget without the need of large measures,” according to sources from the Ministry of Economy.
The next Government will not have to make large adjustments in 2017 to comply with the deficit target committed with the EU, 3.1% of GDP, according to has announced today Luis de Guindos, minister of Economy functions, to Pierre Moscovici, commissioner for Economic Affairs of the EU.
“The next Government will be able to make a budget without the need of large measures,” according to sources from the Ministry of Economy. According to the thesis defended by the Spanish minister to the commissioner, the budget draft that the Government sent to the European Commission between the 1st and the 15th of October, projecting a public deficit “just a little bit superior” to the target.
When the Spanish Executive in functions, the budget plan may not include new tax measures, but the improvement of the public finances would be thanks to the fact that “the economy is still growing at a good pace.”
De Guindos has been seen with Moscovici in Washington, where he held the annual summit of the International Monetary Fund and the World Bank. From there, it will go on Monday to Luxembourg, where will be held the meeting of Finance ministers of the euro area (Eurogroup) and the next day, all of the EU (Ecofin).
in Addition, De Guindos has informed the commissioner that the reform of corporation Tax will be approved probably by the Congress, which will allow to increase the down payment that companies pay each year and, in principle, to raise more than 8,000 million additional euros in this exercise. This, as explained by the minister, should serve to meet the deficit target in 2016, from 4.6%.
If the Commission validates the Government’s forecasts with its own analysis of the fiscal situation of Spain, could thaw the structural funds that is required to freeze from next January 1, after the Spanish government fail to comply voluntarily with the deficit target of 2015.
The European Commission is obliged to announce the suspension of structural funds, which according Guindos could be around 1,300 million euros. And it will be sometime in November, once you have completed the dialogue with the European Parliament on the matter.
The measures of the Government to meet the deficit in 2016 would serve as an excuse to the Commission for thawing the frozen suspension. However, this could come back to reconsider if next year, when Eurostat validated fiscal data for Spain, the figure deviates by 4.6%.
SPAIN: Guindos says to Moscovici that the new Government must not make large adjustments in 2017
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