Germany's Finance Ministry: Tax Revenue Down In May | ForexLive

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BERLIN (MNI) ? German tax revenue ended its upward trend in May,
but the result was distorted to the downside by a technical change in
the tax collection system and markedly higher transfers to the EU, the
Finance Ministry said in its latest monthly report released Wednesday.

Total tax revenue (excluding local taxes) fell 4.3% in May in
annual terms. Results for the January-May period showed a 3.6% annual
increase. For the full year, the government?s forecast is for tax
revenue growth of 4.0%.

Federal tax revenue in April fell by 6.0% on the year. In the first
five months of the year, the annual increase was 1.1%. For the full
year, the government expects a 1.7% increase.

Federal revenue ? tax intake plus other income ? was down 0.6% on
the year in the January-May period, while expenditures fell 1.7%.

In the economic section of its report, the ministry predicted that
economic activity in Germany will likely moderate in the remainder of
the year. It noted the clouded business sentiment due to the Eurozone
sovereign debt crisis.

?A worsening of the debt crisis is also a significant risk for the
development of private consumption, especially given the possible
negative repercussions on the labor market,? the ministry remarked.

Commenting on price developments, the ministry said the moderate
rise of unit labor costs and the wage deals agreed so far this year in
Germany ?are currently no inflation risk.?

?Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com

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