feddisch...
German govt revises 2004 budget deficit to 43.7 bln eur, up 14.4 bln UPDATE 06.10.2004 12:11 Zurück Headlines
(Updating to add in 3rd para that 43.7 bln eur is a record deficit, govt not
coming up with additional savings package in last para)
BERLIN (AFX) - The German government said the federal budget for this year
is expected to run up a deficit of 43.7 bln eur, 14.4 bln more than originally
expected, partly due to lower-than-expected tax revenues.
A statement from the finance ministry said the cabinet today approved the
supplementary budget which revised upward the deficit to 43.7 bln.
The 43.7 bln eur deficit is a record. The previous deficit record was in
1996 when the conservative-led government ran up a deficit of about 80 bln
deutschemarks, equivalent to around 40 bln eur.
The ministry today said the previous 2004 budget was based on tax revenues
which are now expected to be 13 bln eur lower than previous estimates.
On top of the lower tax receipts, the budget will be negatively impacted by
a reduced level of net income from the Bundesbank as well as higher expenditures
for social security and jobless benefits.
It said the additional burdens on the budget could only be partly offset
through reduced interest payments for debts as well as higher income from
privatisation.
"Despite this, it is unavoidable to increase by 14.4 bln eur to 43.7 bln the
new borrowings for this year," the ministry said.
The ministry said given the weakness in the domestic economy, it will be
"counter-productive" to come up with additional savings package to compensate
for the reduced income from tax receipts.
mog/jlw/cml
Greetz f-h
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