Greece 'Shoved Over Red Line' as IMF Pushes Even Harsher Cuts

More austerity, more cuts, or no deal.

That's the message the International Monetary Fund threw back at the Greek government after negotiators on Wednesday rejected the latest reform proposals submitted by the Syriza government.

According to reporting on the ground, there were a "flurry of proposals, counter-proposals, leaks and verbal attacks" in Brussels as Greek Prime Minister Alexis Tsipras continued to try to hash out an acceptable bail-out plan with his creditors ahead of a critical June 30 payment deadline.

Though Syriza supporters and those within the leftist government say that Greece's most recent offer is too austere and abandons pledges made during the election campaign, European creditors still rejected the deal. Instead, the IMF submitted a list of counter-reforms which Greek negotiators described as "absurd" and "not acceptable."

On Monday, the Greek government submitted an offer that would raise the country's VAT (Value-Added Tax) and slash the country's pension system, gradually raising the retirement age to 67.

Following the bank's rejection of that offer, Tsipras accused the lenders of suspiciously holding the country to a different standard than other indebted nations.

"The repeated rejection of equivalent measures by certain institutions never occurred before-neither in Ireland nor Portugal," he wrote on Twitter. "This odd stance seems to indicate that either there is no interest in an agreement or that special interests are being backed."

The IMF's counter proposal, which was leaked Wednesday, showed that the Greek government "has been pushed to raise more from VAT and also make sweeping changes to its pensions system, including raising the retirement age faster and eliminating benefits for the poorest pensioners," the Guardian reports.

BBC economics correspondent Duncan Weldon summarized the two drafts in a Tweet, noting their different approach to so-called "red-line" deal-breakers:

Across Europe this week, anti-austerity activists and other supporters are holding a week of rallies in vigils in solidarity with Greece as it faces off with Europe's financial elite. Campaigners have also launched a petition calling on creditors to cancel Greece's debt and discontinue the punishing austerity agenda.

If a deal is not reached and creditors refuse to release bail-out funds by the end of the month, Greece risks defaulting on its debts, possibly spurring an exit from the European Union.

The Guardian is hosting a live blog as Eurogroup finance ministers meet in Belgium on Wednesday evening to continue discussions.