2013 Deficit Target Will Be Met, States Hungarian Govt.

  • 11 Sep 2013 9:00 AM
2013 Deficit Target Will Be Met, States Hungarian Govt.
The central sub-sector of the state budget posted a deficit of HUF 110.0bn for the month of August 2013. The financial transfer data of the central budget at the end of August is in line with the Government's prior expectations. Revenues and expenditures anticipated for the current and the following months - including an outstanding surplus prognosticated for the month of December - confirm the expectation that this year's below 3 percent deficit target will be met.

Within the central sub-sector of the state budget, the central state budget closed the month with a deficit of HUF 137.4bn, while extra-budgetary state funds and Social Security Funds posted surpluses of HUF 1.0bn and HUF 26.4bn, respectively. Thus, in the month of August 2013 the central sub sector of the state budget registered a deficit of HUF 961.2bn.

Regarding the comparison of expenditures and revenues, it must be taken into account that there is a time gap between the respective data. The Government expects that the budget will receive a significant amount of extra revenue in the month of December, and that will help maintain the anticipated annual deficit level.

Government measures have brought about changes that markedly influenced revenues and expenditures this year and last. On the revenue side, several revenue estimates of certain taxes were revised downward, certain types of taxes were abolished or modified and new taxes were introduced. Until the end of August, on the other hand, certain tax revenues were higher than formerly anticipated, for example those from personal income tax, vehicle registration tax and revenues from duties.

However, it must be emphasised that certain one-off, significant revenue elements such as the amount of 100 billion forints resulting from the sale of frequency usage rights, a part of the four-step payment of financial transaction duty which was stipulated in June, the income tax of energy service providers and a substantial part of corporate income tax liabilities will only be received by the budget until the end of the year.

On the expenditure side, the integration of some local government responsibilities and their respective financing into the central sub sector of the state budget has resulted in additional expenditures. Consequently, the expenditures of the central state budget were some HUF 915bn higher at the end of August.

This year, expenditures relating to healthcare, welfare and other institutions taken over by the state - such as hospitals, institutions providing disabled treatment, childcare facilities - as well as to wages of teachers within public education system were recorded as state expenditures. In addition, railway, road transport and housing subsidies also exceeded the amount paid last year. These factors increased state expenditures by several hundreds of billions of forints.

However, the Government continues to do everything in its power to meet the below 3 percent deficit target and counter-balance the changes arising from structural modifications.

Source: Ministry for National Economy

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