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Poland to revise 2013 budget as deficit grows

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(Globalpost/GlobalPost)

WARSAW (Reuters) - Poland will put draft revisions to its 2013 budget to parliament for approval next month, a senior minister said on Thursday after weak revenues drove up the deficit much faster than targeted.

"There will be a (budget) revision. Parliament will debate it at its first sitting in August," Deputy Prime Minister and Economy Minister Janusz Piechocinski told reporters.

Prime Minister Donald Tusk said he would decide whether the government would need to revise the budget law this week because the sharp economic slowdown is taking its toll on public finances.

Piechocinski gave no details on how the government plans to change this year's budget law given restrictive deficit and debt ceiling laws.

When the government constructed this year's budget in the autumn of last year, the economy was expected to grow by more than 2 percent this year.

But the European Union's sixth largest economy slowed sharply to grow by a meager 0.5 percent year-on-year in the first quarter of the year, raising worries that the government may be forced to increase the deficit target.

The deficit, planned at 35.6 billion zlotys for this year, had already reached 87 percent of the full-year target in May.

Economists estimate that the state budget may be 20-25 billion zlotys short this year as pressure on state spending is high and tax revenues continue to disappoint. This year's budget revenues were forecast at 299.4 billion zlotys.

The finance ministry was not immediately available for comment.

(Reporting by Marcin Goettig, writing by Karolina Slowikowska)

http://www.globalpost.com/dispatch/news/thomson-reuters/130711/poland-revise-2013-budget-deficit-grows