Central Union of Chambers of Commerce on budget

The Central Union of Chambers of Commerce (KEE), in an announcement on Monday commenting on the government’s draft budget which was tabled last week, stressed that “with the prevailing economic and social climate, government optimism is worth wondering” and noted that the increase in VAT from 11 percent to 13 percent was a great mistake.

KEE pointed out that “at a time when consumption has been reduced dramatically (a decrease in turnover of up to 50 percent), when the average income is not only being decreased due to wage cutbacks as well as to an increase in direct taxes (it is estimated by the government that the revenues from the taxation of private individuals will increase 6 percent) one wonders where will VAT be received from to be handed over by businesses.”

It further said that the government’s option “is judged for its logical cohesion since the government itself admits that the revenues from the tax on businesses will decrease by 16 percent, a fact that is attributed to the repercussions of the economic crisis.”

Lastly, it says that growth “is probably an unknown concept for the 2011 budget. The GDP decrease in 2010 amounts to 4.2 percent (beyond the 4 percent prediction) and 3 percent in 2011.”