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Austrian coalition government agrees to cut taxes to stimulate growth

Xinhua, March 13, 2015 Adjust font size:

The Austrian government decided to cut tax by around 5 billion euros (5.3 billion U.S. dollars) on Friday to stimulate economic growth, after months of negotiations between Austrian Social Democrats and its conservative partners.

The decision was made to stimulate the country's economy which is experiencing a relatively difficult time due to the negative effect from the eurozone economy.

Austrian Chancellor Werner Faymann's Social Democrats and his conservative partners struck the deal in the early morning, calling the agreement the country's biggest tax reform after WWII.

Austrian People's Party leader Reinhold Mitterlehner also called the deal as a balanced package to boost economy.

With the tax reform, people with lower earnings are to pay less income tax.

Austria's unemployment rate continued to rise in February to a high of 10.3 percent, imposing more pressure on both the economy and the political coalition. Endi