The budget deficit is likely to be higher than the previous forecast: the Fiscal Council expects a 3.9 percent decline in gross domestic product (GDP) this year and 4.1 percent next year.
In the spring they expected a loss of 3.4 (2024) and 3.2 percent (2025). The Budget Council therefore considers the initiation of an EU deficit procedure as “likely”, according to a press release.
“Economic policies” fuel the deficits
As justification for the high deficits, the debt watchdogs cite ‘long-term economic policy measures’, such as the reduction of corporate taxes, the abolition of the cold progression, the ‘overcompensation of the CO2 tax by the climate bonus’ or the long-term budget burdens caused by COVID-19 -Economic support such as the investment bonus, but also the ongoing recession.
Moreover, expenditures would increase as a result of the new financial equalization, such as through the Future Fund, the sharp increases in military expenditures and investments in railway infrastructure and demographically related structural expenditure increases for healthcare, health care and healthcare. pensions.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
