Business News

Govt Adopts 2013, 2014 Budgets

Ljubljana, 04 October (STA) - The government adopted Thursday proposals for the 2013 and 2014 budgets. Aiming for a deficit between 2.8% and 2.9% of GDP in 2013, the government plans include a 5% cut in the public sector wage bill, increased VAT for some products and services and implementation of the pension reform.

According to Finance Minister Janez Šušteršič, effects of the pension reform should kick in as early as next year, while the 5% cut would apply to the entire public sector, not only the public administration.

Under the government plans, VAT will be increased from 8.5% to 20% for a number of goods and services, including newspapers, magazines and communal services.

Šušteršič said the government measures were a response to deteriorating economic conditions and a downgraded outlook for 2013.

"Nevertheless, the government must respect its commitments in order to keep the budget deficit below 3% of GDP. Respecting this commitment is crucial for maintaining the country's credibility," the finance minister said, stressing the importance of structural reforms.

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