BUDGET EXPENDITURE REMAINS SIX BILLION DOLLARS -- GOVERNMENT

ZAGREB, March 22 (Hina) - The draft government budget for this year in its basic elements will remain as it had been motioned -- the expenditure side will remain within the planned amount of six billion dollars, and the influx part also holds no changes Croatian First Deputy Prime Minister Goran Granic said Wednesday after eight and a half hours of a closed-door Government session at which members voted on more than 420 amendments to the budget handed in to the Parliament House of Representatives. The Government will at the Lower House, which will vote on the draft budget on Thursday, offer its own amendments with which it had tried to assess the spirit of MP amendments. "There is no increase in the budget, most part of the reallocations was realised within ministries and partially among individual ministries," Granic said. He said that, for example, funds had to be found for a credit rate for the Istrian Epsilon highway (DM58 million), and the changes are tied with education, science and so forth. The Government adopted bills pertaining to the budget. Amendments will be motioned to the law on financing units of local government and self-government. They will, Granic said, increase the part of income tax to counties from the current five to eight per cent, and towns and municipalities from 25 per cent to 32 per cent. The reduction in income taxes will thus not be felt on the budgets for units of local government and self-government, Granic explained. The Government also granted government guarantees for Croatian shipyards, of DM33 million and US$299 million. Granic said the Government had decided to invalidate the decision on issuing state guarantees which had been made previously but had not been realised. It was also decided that earlier government credits that had not been realised should be cancelled, excluding only Vukovar's Vupik company. (hina) lml mm