Spain mulls over further income tax rises and pensions cuts

‘El Pais’ are apparently reporting that an unnamed government source has said that further hikes in income tax and cuts in expenditure on pensions could be in the pipeline as a measure to avoid Spain asking for a bailout as the country struggles to meet its budget deficit target.

The government needs to reduce its deficit to 6.3% of GDP by the end of 2012 and despite recent VAT and personal income tax hikes, tax revenues have still fallen.