CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Austria Unites On Debt Brake Rule

Austria Unites On Debt Brake Rule

by Ulrika Lomas,, Brussels

02 December 2011

Following intense negotiations in Salzburg recently, regional finance ministers united in principle on government plans to anchor a debt brake rule in the country’s constitution from 2017.

Within the framework of the discussions, the federal states gave their commitment to ensuring in future transparent and efficient budgetary management, comparable with that of the federal government. It was agreed that limited liabilities together with a multi-annual financial plan would also be set in the constitution.

In accordance with the plans, a structural deficit of 0.1% of gross domestic product (GDP) was considered balanced as regards state and commune budgets, whereas a structural deficit of 0.35% of GDP was considered balanced as regards the federal government budget.

In its release, the Austrian finance ministry notes that although the fixed structural deficit targets may be exceeded, efforts must be made subsequently to return to the constitutional requirements. The ministry points out that an action plan will need to be submitted in the event that the structural deficit reaches 0.35% in the case of the federal states or communes and 1.25% in the case of the government.

The ministry explains in its release that by way of compromise, it was agreed during the discussions that each federal state would be responsible for adhering to the requirements of the debt brake rule, and accountable for failing to do so. A consensus on providing for specific exceptions to the rules in the event of a natural disaster or an economic crisis was also achieved, the ministry adds.

Commenting on the outcome of the negotiations, Austria’s Finance Minister Maria Fekter underscored that the agreement marked an important step in the right direction, sending out a crucial signal to the financial markets as regards the country’s commitment to stability and to a future-orientated economy, determined to address the growing debt mountain.

TAGS: tax | economics | fiscal policy | budget | Austria

To see today's news, click here.


Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »

Stay Updated

Please enter your email address to join the mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.

To manage your mailing list preferences, please click here »