The coalition is proposing massive reforms to modernise an economy that for decades has been marked by over-regulation and high costs. It is also an economy that can be strongly resistant to change and technology, to which anyone trying to find a restaurant that accepts credit cards can attest. Holiday entitlements are to be tightened. Efforts are also underway to strengthen state finances. These measures include cuts in government spending by reducing the civil servant workforce, slashing subsidies and curtailing pension benefits.
Revenue is to be boosted by increases in consumption taxes.
On June 1, VAT was doubled on beer and alcohol. Tobacco and insurance taxes were hiked. Passport and identity card fees more than doubled. A levy on electricity went up. In most cases the plans have pleased the business community, but Austria s traditional conservatism is holding expectations of any sweeping change in check.