SLD leftist party withdraws from its plans to cut VAT

MG
17-07-2007, 15:56

Warsaw (Puls Biznesu) – SLD withdrew its bill providing for a cut in the basic VAT rate from 22 to 19 percent.

Yesterday, the leftist opposition party decided to give up the plans providing for cutting VAT. Entrepreneurs had previously welcomed the news published several days ago by “PB”. The bill had been submitted to the Parliament.
“Having consulted SLD MPs we have decided that the decision was premature. We will come back to the idea when the budget is stabile, the budget deficit and public debt are cut”, Jerzy Szmajdzinski, the head of SLD party said.
He added that the reason for the withdrawal was the fact that SLD MPs have not been consulted on the idea.
 
SLD wanted to lower VAT starting on January 1st 2008. The party estimated that it would cost the state PLN 7.5 billion (EUR 2 billion) but the losses would be compensated by increased sales of goods and services. Several ex-ministers of finance commented that this solution would hurt the budget and increase inflationary pressure with no synergies for the economy in short term.
(PLN 1 = EUR 0.267)

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