Tuesday, March 29, 2011

Greece Seeks Creative Ways to Plug Budget Gap

Wall Street Journal
March 28, 2011

Greece's Socialist government is considering creative means to close its budget gap as tax receipts slump—including steps ranging from seizing the unclaimed assets of the dead to slapping new taxes on carbonated drinks.

Ahead of a visit by international creditors Monday, the government is scrambling to find €22 billion ($31 billion) in additional spending cuts and tax measures over the next three years, as required under a €110 billion bailout it received from the European Union and the International Monetary Fund in May.

"Tax collection is not coming in as expected, so the government, beyond pushing on that front, will look for other ways to close the gap," said a senior government official. "Seeking funds from unclaimed inheritances and from [bank] accounts from people long deceased, are some things that are being considered," he said. "A tax on soft drinks is also being seriously considered."

Seizing unclaimed assets of the dead—some such estates have been in legal limbo for decades—could net the state around €4 billion in revenue, the official said.


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