Despite big hikes in taxes, Greece΄s state budget deficit widened sharply in the first two months of the year as steeper spending cuts failed to offset a shortfall in revenues, but the figures were in line with the government΄s broader targets.
The tax hikes have worsened the country’s recession, now in its sixth year, and slowed spending so much that expected revenues are far off target. In a statement, the Finance Ministry said the budget shortfall for January to February reached 813 million euros ($1.06 billion) compared with a deficit of 495 million euros in the year-earlier period. The targeted deficit for the period stands at 2.6 billion euros.
Revenues fell 700 million euros, to 8.6 billion from 9.3 billion last year, with property and personal taxes rising while indirect taxes fell, the data showed. On the spending side, state budget outlays slipped to 9.4 billion euros from 9.8 billion, compared with a target of 10.5 billion euros.
The state budget includes central government operations and Greece΄s public works budget, but doesn΄t include other national government entities and operations, like some of the state pension funds or defense spending, which are reflected in the general government budget, making the picture even bleaker than expected for now.
Cash-strapped Greece puts govt buildings on block
Greece’s cash-strapped government detailed Monday its plans to sell 28 state-owned buildings on long-term lease, including tax offices, ministry buildings, and the main police headquarters in Athens.
A government privatization fund said it hoped to make €30 million ($39 million) annually from the lease agreements lasting 20-25 years.
Included on the list of buildings for sale are the main properties used by the ministries of justice, education and culture, 12 tax offices and the greater Athens police headquarters.
Potential investors should express their interest by April 19, according to a statement by the Hellenic Republic Asset Development Fund.
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