The Tax Authority Lowers The Growth Forecast

The Independent Authority for Fiscal Responsibility ( AIReF ) has lowered its economic growth forecast for Spain in 2021 to 6.6% , 1.6 points below the 8.2% predicted by the central scenario in its last report.

This decision is in addition to the one announced by the Second Vice President and Minister of Economy, Nadia Calviño, who in an interview with Bloomberg recognizes that the Government will lower its growth forecast for this year, located at 7.2% and that it could reach the 9.8% if the effect of European funds is included.

It is also known a few days after the International Monetary Fund (IMF) announced that it has raised its estimates for Spain, which were below those of the Executive, by five tenths, to 6.4% this year.

In the presentation of the Report on the Initial Budgets of Public Administrations, the director of the AIReF Economic Analysis division, Esther Gordo, explained that this reduction is due to the worse evolution of the pandemic , which affects less tourism , and the delay in the execution of European funds .

The institution chaired by Cristina Herrero has warned that uncertainty persists about the execution of the Recovery and Resilience Plan (PRTR), both in terms of the details of its implementation and the ability to deploy its effects in 2021.

For this reason For this reason, AIReF foresees that the macroeconomic impact of the plan for this year will be lowered from the estimated 2.7 points of GDP, to 1.6 points in the absence of knowing the specific projects.

AIReF has also modified its forecast for deficit, which improves to 7.6% of GDP (4 tenths less than in its previous report), and debt, which worsens to 118.7% of GDP (2.7 points more). That in its central scenario, reducing its forecast by just over three tenths compared to the November report.

Thus, and after closing 2020 with a deficit for all administrations of 11% of GDP, AIReF estimates that the economic recovery , the progressive withdrawal of measures against the pandemic , the absence of relevant non-recurring elements such as the reclassification of the Sareb and the tax modifications included in the draft of the State budgets promote a reduction of the deficit of 3.3 points of GDP in 2021.

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