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Tuesday, 7 February 2012

Dramatic drop in budget revenues in Greece- expect EUR fall as a rock

Wow, the figures are really damning. Originally leaked by German tabloid Bild! The Greece is legendary for its tax evasion and grey economy, which eclipses even Russia. But these numbers eye popping: VAT down -18.7 %, tax revenure -7%,- sirtaki continues! Ekathimerini reprots: Budget revenues were found to be lagging by a considerable 1 billion euros in the year’s first month, provisional January data compiled by the Finance Ministry showed on Tuesday. Revenues posted a 7 percent decline compared with January 2011, while the target that had been set in the budget provided for an 8.9 percent annual increase. Worse still, value-added tax receipts posted an 18.7 percent decrease last month from January 2011 as the economy continues to tread the path of recession: VAT receipts only amounted to 1.85 billion euros in January compared to 2.29 billion in the same month last year. The VAT revenue data represent a particular worrying sign regarding the depth of recession for 2012, while even more painful measures are expected to lead to a reduction in salaries and therefore a further drop in consumption. This is the vicious cycle that the government will have to tackle by way of additional fiscal measures this summer. According to the current data, the 2012 budget will certainly have to be revised soon, given that the original estimate for a contraction of 2.8 percent is now raised to 3.5-4 percent of gross domestic product. These numbers are in BILLIONS! Expect Euro fall flat and face down on a pavement! Make your bets against Euro!

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