| Author (Corporate) | European Commission |
|---|---|
| Series Title | COM |
| Series Details | (2013) 393 final (29.5.13) |
| Publication Date | 29/05/2013 |
| Content Type | Policy-making |
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According to Article 126 of the Treaty on the Functioning of the European Union (TFEU) Member States shall avoid excessive government deficits. On 7 July 2009, the Council decided that an excessive deficit existed in Poland and issued a recommendation to correct the excessive deficit by 2012 at the latest, in accordance with Article 3 of Council Regulation (EC) No 1467/97 of 7 July 1997 on speeding up and clarifying the implementation of the excessive deficit procedure. In order to bring the general government deficit below 3% of GDP in a credible and sustainable manner, the Polish authorities were recommended to implement the fiscal stimulus measures in 2009 as planned, ensure an average annual structural budgetary adjustment of at least 1.25 percentage points of GDP starting in 2010, spell out detailed measures that are necessary to bring the deficit below the reference value by 2012 and introduce reforms to contain primary current expenditure over the following years. The Council established a deadline of 7 January 2010 for effective action to be taken. The Commission services' 2013 spring forecast projects the general government deficit at 3.9% of GDP in 2013 (against Poland's deficit target for 2013 of 3.5% of GDP) and, under a no-policy-change assumption, at 4.1% of GDP in 2014. Taking into account additional measures contained in the 2013 update of the Polish Convergence Programme (CP), which was published after the cut-off date of the Commission services' 2013 spring forecast, hardly changes the assessment. For 2013 the CP does not incorporate new discretionary measures. Although the CP envisages keeping VAT rates at their current level instead of lowering them, the inclusion of this measure would, according to Commission estimates, reduce the 2014 deficit to 3.7% of GDP. Therefore, the Commission service’s spring forecast has been updated with the measures included in the CP in order to have an accurate baseline scenario for the new recommendation. In view of the above and consistent with the rules of the Stability and Growth Pact, an extension of the deadline to correct the excessive deficit by two years is warranted. |
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| Source Link | Link to Main Source http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=COM:2013:393:FIN |
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| Countries / Regions | Poland |
