The Polish economy is expected to grow by 3.7% this year, a 0.2 pps uptick from the previous forecast, while the general government deficit is now expected to stay at 2.6% of GDP in 2016, but grow to 3.1% in 2017, the new, spring set of economic forecasts from the European Commission shows.
While the general government deficit forecasts have been reduced vis-a-vis winter projections, the European Commission still expects a 3.1% gap in 2017, but admits the forecast is burdened with considerable uncertainty.
On the one hand, the deficit may be increased by plans of lowering the retirement age or raising the standardized PIT deduction, but on the other hand, the government is trying to increase tax collection, the European Commission said.
