Helsinki - The Finnish government Tuesday revised its budget and said it aimed to introduce measures to secure employment in the flagging construction industry. The finance ministry also lowered its forecast of economic growth to 0.5 per cent next year, down 1.3 percentage points on estimates made in September.
Unemployment was estimated to increase 0.5 percentage points to 7 per cent in 2009, the ministry said while inflation would drop on lower raw material prices and housing prices.
Earlier announced tax cuts were however to remain in place, Prime Minister Matti Vanhanen told reporters. "Now is the right time to stimulate the economy," he said.
The plan included construction of new apartment buildings and renovating buildings, including public buildings like schools.
The government estimated that it would need to borrow 2.2 billion euros (2.7 billion dollars) to compensate the budget deficit.
In a separate move, the government approved a 10-per-cent tax hike on alcohol, saying it was necessary to reduce consumption.
It is estimated that the alcohol tax hike, due to take effect early in 2009, will add some 65 million euros (82 million dollars) to state coffers.
The tax on spirits was due to be higher than beer and wine.
