Athugið þessi frétt er meira en 2 mánaða gömul.

2022 budget bill presented

30.11.2021 - 11:57
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 Mynd: RÚV
Finance minister Bjarni Benediktsson has this morning presented his 2022 budget bill. He says that despite the 450 billion króna budget deficit over two years, the economic situation is better than expected. The budget anticipates continued deficits for the coming years—though becoming smaller.

“What I am looking most towards is the change between years. We are seeing very positive changes, not just between 2021 and 2022 but also further along when we make future calculations. Every year the situation looks a little better,” Bjarni said this morning. The debt burden will likely grow to 40 percent of GDP by 2026, but Bjarni says this is low by international comparison. 

Not cutting back 

“We have a general demand for restraint in many parts of government operations, but we are not announcing any cuts in any area. We are rather saying that through this economic low, it is better to finance the deficit, to take loans for it, and wait for the private sector to pick up again. That is where the jobs were lost,” Bjarni says. 

Asked if new coronavirus variants are a concern, Bjarni says all eventualities must be considered, but that he does not see any benefit to taking drastic action over unpredictable possibilities. He believes the vaccine manufacturers will be quick to respond to any new threat. 

The budget bill proposes 16 billion krónur extra to healthcare, with Bjarni pointing out further increases will still be needed in the coming years as the nation ages and healthcare becomes more expensive. 

Bjarni says work must start now to change how private transport is taxed, so that people pay to use the road network in their alternative-powered cars rather than paying tax on fuel. This will be important as Iceland plans to be the first nation to phase out fossil fuels in land transport. 

Further increases to disability and rehabilitation pensioners' benefits are proposed, an extra increase in the retirement income limit for pensioners, refunds on research and development costs will continue, and child benefits and deductions increased. 

13 billion krónur is put aside for climate change actions, including tax breaks for energy switch activities, and support for horticulture, forestry, and land use change. 

Bjarni says that, if conditions allow, the state will sell off its remaining stake in Íslandsbanki. Meanwhile, there are no plans to re-privatise Landsbankinn at this time. 

Bjarni says he expects the bill to change as it passes through Alþingi, with new suggestions taken on board from government and opposition alike. 

Ministries were for the first time asked to include an equality assessment with their budget proposals to the finance ministry this year, explaining the potential impacts of their requests and suggestions on equality issues. 

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