Spain unveils €27bn of budget cuts

Spain has announced plans to cut its budget by €27bn in 2012 as part of one of the toughest austerity drives in history.

As part of the austerity measures, public sector workers' salaries will be frozen and departmental budgets will be cut by 16.9%, the BBC reports. The Spanish government said the measures will raise €12bn this year, boosted by a tax increase for larger companies. Last month Prime Minister Mariano Rajoy agreed with the European Commission to cut the troubled economy's deficit to 5.3% of GDP over the course of 2012. But economists have questioned whether the outlined measures will be enough to fulfill Spain's promise to the EC. Yesterday, Spanish police clashed with protesters afte...