Portugal's Prime Minister Passos Coelho says he will not raise taxes in order to meet this...

|By:, SA News Editor

Portugal's Prime Minister Passos Coelho says he will not raise taxes in order to meet this year's budget target after a Constitutional Court struck down wage and pension cuts Friday (I, II). Instead, the government will seek to cut spending in other areas. An unnamed source suggested public sector employees may be paid in Treasury bills effectively "forcing them … to lend the Treasury the money the court said it couldn't cut from their paychecks." This notion was quickly dispelled by a government spokesperson.