PORTUGAL FACES A FINANCIAL RISK

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PORTUGAL FACES A FINANCIAL RISK

 

Dwindling tax revenues brought on by record joblessness and deep recession may force Portugal to seek breathing space, much like Greece has, on commitments to EU-IMF creditors.

 
. Dwindling tax revenues brought on by record joblessness and deep recession may force Portugal to seek breathing space, much like Greece has, on commitments to EU-IMF creditors. According to the Portuguese budget office, tax receipts of first half of 2012 dropped 3,5 per cent compared with the same period last year, due to fall in consumption as the economy shrank and unemployment reached 15 per cent. The government, which had forecast an increase in revenue of 2.6 per cent this year, is expected to miss this year’s deficit target of 4.5 per cent if it cannot come up with an extra 0 2-3 billion cures. The situation points towards the need for flexibility on Por­tugal’s rescue program.

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