Government adopts budget review

The government has adopted the budget review for 2009 and all its accompanying laws, including the Law on Salaries, at today’s cabinet meeting. Government sources confirmed earlier for B92 that budget income, initially planned to be 7.5bn, will now be 7bn. Government adopts budget review Expenditure will also be cut. Instead of EUR 8bn, the state will have about EUR 7.7bn to spend. The budget deficit will be raised from EUR 532mn to EUR 744mn after the review. The draft review for 2009 will be accompanied with new laws, and appear before the government this morning. The government is also expected to discuss two draft laws, so-called lex specialis laws. The first law is related to reducing public administration salaries by 10 percent for salaries greater than RSD 40,000 (EUR 425) and 15 percent on those above RSD 100,000 (EUR 1,063). The second law relates to the pre-registration of vehicles with economic number plates and foreign registrations, which their owners have to pay customs and VAT for in Serbia. The public is also expected to find out how much the government will increase taxes on so-called luxury assets, such as villas, yachts, private jets and luxury cars. A 10 percent increase in taxes on mobile phone services has also been announced, with an increase in excise on diesel and other fuel from two to four dinars. The adoption of the review and accompanying laws is a condition for the IMF to approve its new EUR 3bn arrangement with Serbia on May 11. Democratic Party whip Nada Kolundzija said that the budget review would lead to big cuts in public spending and create the conditions for concluding the arrangement with the IMF, which was the basis for the country’s macro-economic stability during the economic crisis. She told journalists at the National Parliament building that “the budget review will lead to significant cuts in public spending, which also involves salary reductions in public agencies and institutions formed by the government,” adding that she hoped that the government would be able to transfer the burden of the crisis on to the richest. United Serbia leader Dragan Markovic said that his party would support the budget review and the government’s measures to tackle the crisis. “I think this is the best measure that the government’ has proposed, since, right now, no better measure could have been proposed with budget revenue such as it is,” he said, stating that the government measures would reach parliament next week. The cabinet (FoNet, archive)

Government adopts budget review

Expenditure will also be cut. Instead of EUR 8bn, the state will have about EUR 7.7bn to spend. The budget deficit will be raised from EUR 532mn to EUR 744mn after the review.

The draft review for 2009 will be accompanied with new laws, and appear before the government this morning. The government is also expected to discuss two draft laws, so-called lex specialis laws.

The first law is related to reducing public administration salaries by 10 percent for salaries greater than RSD 40,000 (EUR 425) and 15 percent on those above RSD 100,000 (EUR 1,063).

The second law relates to the pre-registration of vehicles with economic number plates and foreign registrations, which their owners have to pay customs and VAT for in Serbia.

The public is also expected to find out how much the government will increase taxes on so-called luxury assets, such as villas, yachts, private jets and luxury cars.

A 10 percent increase in taxes on mobile phone services has also been announced, with an increase in excise on diesel and other fuel from two to four dinars.

The adoption of the review and accompanying laws is a condition for the IMF to approve its new EUR 3bn arrangement with Serbia on May 11.

Democratic Party whip Nada Kolundžija said that the budget review would lead to big cuts in public spending and create the conditions for concluding the arrangement with the IMF, which was the basis for the country’s macro-economic stability during the economic crisis.

She told journalists at the National Parliament building that “the budget review will lead to significant cuts in public spending, which also involves salary reductions in public agencies and institutions formed by the government,” adding that she hoped that the government would be able to transfer the burden of the crisis on to the richest.

United Serbia leader Dragan Marković said that his party would support the budget review and the government’s measures to tackle the crisis.

“I think this is the best measure that the government’ has proposed, since, right now, no better measure could have been proposed with budget revenue such as it is,” he said, stating that the government measures would reach parliament next week.