ECONOMY

Greece stems decline in tax revenues in February, ministry says

Greek tax revenues dipped slightly in February, but there was no repeat of the calamitous fall in January, the Finance Ministry said on Friday, bringing some relief to the government as it tries to negotiate a new bailout deal with Europe.

Tax receipts came in just 121 million euros below target last month after a massive 1.048 billion shortfall in January, which had raised fears the newly installed government might run out of cash before reaching any accord with its EU partners.

Greeks put off paying taxes in the first weeks of the year ahead of a snap January 25 election, which was won by the leftist Syriza party on promises to end years of austerity imposed on Greece by its international creditors.

Overall, tax revenues came in at 7.298 billion euros in the first two months of 2015, 13.8 percent below a target of 8.467 billion euros, the ministry said.

The central government surplus came in at 1.243 billion euros in the first two months of 2015, against a target of 1.411 billion euros, the ministry said in a statement.

This figure excludes the budgets of social security organizations and local administrations and is different from the data monitored by Greece’s EU/IMF lenders, but nonetheless indicates the country’s progress in repairing its finances.

Previous governments have agreed with lenders to achieve a primary surplus of 3 percent in 2015 — a figure which Prime Minister Alexis Tsipras is seeking to reduce as part of its efforts to free up funds for growth measures.

The stemming of the decline in tax revenues will be welcome news to the government, which is facing a possible cash crunch as it tries to meet looming debt service commitments to its EU IMF and ECB creditors.

[Reuters]