The new conservative government of Spain has announced further steps to reduce the deficit and new austerity measures in order to obtain a Euro bailout, all of which was met with protests.
The new measures are defined by lower pay and higher taxes. The Value Added Tax (VAT) for goods and services will go up by 3 points to 21 percent. The austerity plan is also proposing cuts in unemployment benefits and cuts in civil servants paychecks.
This news was not been received well with thousands protesting the proposed measures today. CNN is reporting more than 70 people were injured in clashes with police today.
The country’s unemployment rate stands at almost 25 percent while thousands of families have been evicted from their homes after falling behind on their mortgages.
For now pensions were not touched by the government of Prime Minister Mariano Rajoy. Overall, there is fear that these measures will put Spain into a further economic recession.
The up to 100 billion euros ($122.7 billion) in aid the Eurogroup has approved for Spain’s troubled banks will be disbursed over the next 18 months, with the first installment due by the end of July, the Spanish economy minister announce this week.