September 9, 2018 / 11:39 AM / in a month

Greece says high surplus forecasts mean pension cuts, tax hikes not needed

THESSALONIKI, Greece (Reuters) - Greece does not think it needs to cut pensions next year or increase tax on earnings scheduled for 2020 because it expects to exceed budget surplus targets set under a post-bailout adjustment programme, Prime Minister Alexis Tsipras said on Sunday.

Greek Prime Minister Alexis Tsipras delivers a speech during the opening of the annual International Trade Fair of Thessaloniki, in Thessaloniki, Greece, September 8, 2018. REUTERS/Costas Baltas

Greece legislated the measures to convince its lenders that it would stay on the path of fiscal consolidation in the post-bailout period.

Tsipras told a news conference the country would submit its economic projections to the European Commission in mid-October where it would support the view the pension cuts would be unnecessary.

Within those calculations, he said, authorities expected to ‘far exceed’ a 3.5 percent primary budget surplus for next year, a level which would allow Athens to shelve plans for further pension cuts.

The same rationale applied for 2020, when a decrease in the tax-free threshold on earnings was due to take effect, he said.

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