Stimulating Effects of Tax Cuts Dampened by Counter-Financing Measures. Economic Outlook for 2015 and 2016

At a projected rate of 0.5 percent for 2015, GDP growth in Austria remains subdued for the fourth consecutive year. With intra-EU trade picking up in 2016, domestic growth should accelerate to 1.3 percent. Exports will also be sustained by the significant depreciation of the euro. The tax reform 2015-16 will give support to private demand, while restraining public consumption. The moderate pace of growth over the projection period will not bring the rise in unemployment to a halt.