The European Commission wants the European Union to fight the economic slowdown with a €200 billion stimulus plan to increase both growth and confidence with consumers and businesses. The two plan calls for 27 European Union governments to increase spending to hopefully bring to an end the economic slowdown, which has pushed the EU into a recession.
The plan would be €170 billion from national government and €30 billion from the European investment bank; this investment will be 1.5% of the EU gross GDP.
The recovery plan has been called “big and bold, yet strategic and sustainable.”
OECD said that targeted and temporary tax cuts are necessary for help alleviate problems. Britain has decreased their VAT tax from 17.5% to 15%; however, both Germany and France have rejected proposals to decrease their tax rates. Germany said that they are waiting to see the effect of the €32 billion rescue plan that was announced recently.
1 comment:
It's funny how all this spending is not what's supposed to save these economies directly. Their main function is to increase confidence of the consumer to put money back into circulation. If people are just too scared to spend it doesn't really matter how much they put in. Of course you have people being trampled at Wal Mart while I type this so maybe it will be okay.
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