Prime Minister Petteri Orpo (NCP) and Minister of Finance Riikka Purra (PS) chatted during a question-time debate in parliament on 23 November 2023. Purra on Tuesday stated to YLE that the government may have to carry out additional fiscal adjustments worth two billion euros in order to reduce the budget deficit. (Markku Ulander – Lehtikuva)
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THE NEED for fiscal adjustment could rise from 1.5 to 2.0 billion euros, according to Minister of Finance Riikka Purra (PS).
Purra on Tuesday stated on YLE A-studio that the adjustments will consist of spending cuts and tax reforms, with central government spending to be reduced by at least 500 million and at most 1 billion euros. The government, she added, will likely also re-examine taxation in an attempt to reduce the gaping budget deficit.
“I can guarantee that it’ll be a very challenging task,” she remarked.
While Purra expressed her tentative support for raising the value-added tax, she indicated that she believes also other measures can be found, pointing to the capital gains of corporations as an example. She also promised that no cuts will be targeted at defence or basic education but stopped short of doing the same for social security, stating simply that further social security cuts are unlikely.
“We’ve yet to make a single political decision,” she said, reminding that all options are on the table.
The minister of finance also expressed her readiness to make further cuts in development assistance appropriations. “We’re reducing it by more than a billion euros this electoral term, but as far as I’m concerned we could cut a lot more there,” she said to the public broadcasting company.
Purra added that the adjustment measures will be specified based on the development of the economic situation, employment situation and tax revenue.
The International Monetary Fund (IMF) on Tuesday published its latest country report for Finland, urging the central government to take further action to tackle the budget deficit.
“It’s not unusual that the government presents its goals and measures gradually during the electoral term. But at this point, we actually see that the deficit is growing while it should be shrinking,” Alex Pienkowski, the head of the staff team for Finland at the IMF, was quoted saying at a news conference in Helsinki on Tuesday by YLE.
Aleksi Teivainen – HT
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Source: www.helsinkitimes.fi
