ECONOMY

Gov?t close to revenues target

The government came close to meeting its budget revenues target for January, with the total amount just 150 million euros short of the goal. The budget target was for an inflow of 5.65 billion euros to the public coffers, while the Finance Ministry reported revenues of 5.5 billion. The goal for the whole year stands at 59.36 billion.

However, the sum is 500 million euros or 8.3 percent less than January 2010 revenues, when the figure came in at 6.025 billion.

Ministry officials argue that the decline compared to last year was to be expected, as then there had been an additional 650 million from the extraordinary company levy and 400 million from road tax.

This January there was a further loss of about 200 million euros resulting from the reduced tax on salaries owing to the reduction in the Christmas bonus. On the other hand, a tax amnesty process for unsettled cases from the previous decade was under way in January, which for the whole of this year is estimated to net 900 million euros in revenues.

January’s preliminary data compiled by the ministry showed that revenues from value-added tax recorded a 12 percent increase compared with the same month in 2010. VAT revenues last month came to 2.28 billion euros, up from 2.043 billion in January 2010 and 2.25 billion in the same month of 2009.

The ministry is particularly worried about this year’s budget as the scope for cutting expenditure is particularly limited last year the revenues shortfall was covered by spending cuts, a move which can hardly be repeated this year. In this context, the government will make an additional effort to reduce tax evasion through the bill set to become law by the end of the month.

In Washington, an International Monetary Fund spokeswoman reiterated that the organization is considering extending Greece’s repayment period from three to 10 years, but stressed that this was the limit.