Ministers agree to reduce tax
20 August 2002
AMSTERDAM ?The Cabinet has decided to give employers and employees lower unemployment premiums totaling EUR 500 million.
But the NRC Handelsblad reported on Tuesday that the reduction in tax was promised on the condition that employers and unions agree to wage rise moderation.
A Monday-evening meeting of the seven most closely involved ministers resolved that the tax reduction could increase to EUR 500 million. A Tuesday meeting confirmed that resolution.
The tax reduction means that the new government will need to save an extra EUR 500 million on top of a decision last weekend to save an extra EUR 1.5 billion in a bid to reduce an expected budget deficit.
The extra savings are required after the Central Planning Bureau (CPB) recently reduced its economic forecast for next year from 2.25 percent to 1.5 percent.
Dutch associated press ANP said the cabinet is attempting to restrict the budget deficit to 0.4 percent of GDP and the full cabinet was expected to reach an official agreement over the tax cuts on Wednesday.
The coalition policy statement previously promised savings of EUR 7 billion over the coming term of government.
[Copyright Expatica News 2002]
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