The working draft of the stability programme includes the proposal to raise both VAT rates - the basic one by 2 percentage points to 22% and the lower by 1 percentage point to 9.5%. The changed rates, to be put into force with the start of 2014, are expected to bring an extra EUR 250m into the budget annually.

The second key long-term measure planned on the revenue side is a changed real estate tax system, which would be introduced in 2014 in line with one version of the documents and in 2015 in line with another.

Also in the pipeline is a temporary crisis tax on personal income, which would not increase the tax burden on employers but on workers. The annual effect of the measure, which would be put in place for a period of 18 months already in the middle of this year, is estimated at EUR 300m.

Moreover planned is a stopping of the gradual reduction of the corporate tax at the present 17%, whereas the previous government wanted it to go down to 15% by 2015.

The detailed timeline of the new tax burdens would be set by the government after consultations with social partners, while it also depends on the effects of measures on the expenditure side.

Fiscal policy goals include a structurally balanced budget by 2017, which would also be enabled with a reduction of the budget deficit below 3% of GDP by 2105, as well as a stabilisation of government debt at around 60% of GDP.

Meanwhile, key measures for economic growth are to be based on the strengthening of banks and the deleveraging and restructuring of companies.

The list includes the transfer of EUR 4b worth of bad claims onto the bad bank and securing capital adequacy comparable to EU average.

Along with the already executed EUR 420m, another EUR 900m are expected by the end of July this year in capital injections to banks. These capital increases would mean a one-off increase in the budget deficit for 2013 from 4.1% to 7.8% of GDP.

Companies can expect new legislation simplifying deleveraging and restructuring as well as help from the state and private investors.

The management of state-owned companies is to be improved, while the government plans to draw up a list of companies slated for privatisation before the end of this month.

The stability programme also envisages enshrining the golden fiscal rule into the Constitution, the government however feels that doing this in 2015 would mean unrealistic interventions.

Starting to use the rule in 2017 would require a revenues plus spending correction of EUR 400m, with the government assessing that, given all the other measures, planned this goal is attainable.

The 3% GDP deficit target by 2015 is expected to entail combined savings (two thirds) or increased revenue (one third) of EUR 1bn annually.

This would require further cuts to wages in the public sector, in operations of other budget users, as well restrictive measures concerning pensions and social transfers.