Mercoledì, 19 Settembre 2018

ECB says Italy's deficit target for 2013 at risk


Rome, September 12 - The European Central Bank said
Thursday that there was a risk Italy will not achieve its
deficit target for this year.
The ECB said in its monthly bulletin that moves to pay
public-sector debts to private companies and the rolling back of
the IMU property tax could affect Rome's ability to bring down
the deficit-GDP ratio to 2.9%.
The central bank also mentioned the decision to postpone a
planned 1% rise in the top band of value-added tax (VAT), a hike
Premier Enrico Letta's government is hoping to avoid completely.
The European Commission closed an excessive-deficit
procedure against Italy in May after its deficit came in at 3%
last year and the government said it would be 2.9% this year.
The EU does not allow member States to have a deficit of
over 3%.
Last week the Italian government said in a report that it
had revised its deficit-to-GDP ratio forecast for this
year up from 2.9% to 3% following the decision to scrap IMU.
"In Italy, preliminary state budget execution in cash
terms up to July 2013 points to a cumulative borrowing
requirement of 51 billion euros (3.3% of GDP), up from almost 28
billion euros (1.8% of GDP) in the same period of 2012," the
ECB's bulletin said.
"The deterioration, mainly owing to the provision of
financial sector support and repayment of arrears, highlights
the increasing risks surrounding the achievement of the 2013
general government deficit target (2.9% of GDP).
"In August the government announced the abolition of the
first instalment of the tax on owner-occupied dwellings for
"The revenue loss (of about €2.4 billion, i.e. 0.1% of
GDP) will be compensated for via lower spending and higher
"The parliament also decided in August to postpone the 1
percentage point increase in the standard VAT rate by three
months to 1 October.
"The revenue loss from this postponement will
be offset by higher excise taxes on selected products and
temporarily higher direct taxes".
Premier Enrico Letta pledged Monday that Italy would
respect its commitment "to keep its deficit-to-GDP ratio
under 3%" and avoid further debt following a meeting with
European Council President Herman Van Rompuy.

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