The Government denies that the tax revenues are then weak as KS claims. – Porsgrunn Dagblad

According to KS ‘calculations tax revenues in municipalities 1.9 billion lower than projected in the state budget for this year. The calculations follow expectations of extra funds from the government to cover up the loss of substantial revenues.

Adjusted downward

Under the government’s work with the revised state budget will, however, revealed that KS takes too hard and that the calculations are made on very thin basis.

In a backing document NTB has gained access to, the estimate for municipal tax revenues revised down by 1.6 billion. In addition, the Government believes that the municipalities are going to save 300 million dollars in wage and price inflation this year will be lower than expected.

Therefore, the government projected a decline of 1.3 billion the free revenue this year.

Need more money

The changes in tax revenues was mainly due to lower wage growth, but at the same time it becomes the note pointed out that wage growth in the municipalities this year will be 3.2 percent – significantly higher than the rest of society, where it is estimated at 2.7 percent.

“It helps to weaken municipal economy”, determined the government note.

KS has moreover only assumed trends in municipal tax revenue in March and provided for their estimate that it will be identical each month throughout the year.

– It is true that our estimates are uncertain, because we saw early on year has a very flimsy basis for saying anything about tax receipts rest of the year, said director of interest policy Helge Eide in KS.

Eide “does not use much energy to disagree” with the government, and stresses that it is important for KS is being given additional transfers that sustain local government activity. Without additional funds from the government believes many municipalities that they will be forced to cut services.

Unresolved

How much of the loss of income that might be covered by additional transfers when revised budget submitted until about ten days, is highly uncertain until the revised budget is presented.

Local Government Minister Jan Tore Sanner has NTB opened for increased transfers to municipalities. But if that were to happen, it is far from certain that all the revenue shortfall will be compensated and the transfers are hardly connected to taxes decline.

The government will not be “compensated” those years municipalities have increased tax revenues. Then it is not natural that tax failures are compensated directly by the NTB are told, however, that the government is considering the overall economy when it determines the size of any transfers.

– There may be factors that pull in another direction and that makes the framework for municipalities is not as gloomy as the estimate of tax glitch gives the impression, said Sanner. (AFP)