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Spain raises taxes to try to meet EU deficit target

MADRID – Spain’s conservative government says it hopes to bring in an extra 7.5 billion euros ($8 billion) in taxes to help bring down its budget deficit next year to close to the 3 per cent level permitted by the European Union.

Finance Minister Cristobal Montoro said Friday the government hopes to get most of the money — 4.3 billion euros — from increased company taxes and the rest from anti-tax fraud measures and taxes on alcohol, tobacco and sugary drinks.

Spain is battling to reduce its deficit from an expected 4.6 per cent of GDP this year to an EU-agreed 3.1 per cent in 2017 to avoid sanctions.

Spain’s deficit soared to an 11.2 per cent high in 2009 during its economic crisis. Its economy is now one of the fastest growing in the EU.