The central budget had a 843.7 billion forint deficit and the social insurance funds were 81.8 billion forints in the red at the end of July. The separate state funds ran a 108.7 billion forint surplus.

In July alone, the budget, excluding local councils, ran a 94.4 billion forint surplus. Last year in July there was a monthly deficit of 62.7 billion forints.

The seven-month deficit was up from 464.8 billion forints in the base period. According to the ministry, the July surplus was achieved primarily because of an increase in tax revenues.

There has been substantial growth in VAT revenues, PIT revenues and income from health-care contributions and payroll tax. Revenue from sales of state-owned farmland also increased income.

The ministry noted the effects of advanced payments from domestic funds for EU tenders raised expenditures. Advanced payments reached 1,090 billion forints in January-July compared to 601.7 billion forints for the same period last year.

The state of budget finances is “stable” and the 2.4 percent-of-GDP deficit target for the full year calculated according to EU accounting rules “can be safely achieved”, the ministry added.

Republished with permission of Hungary Matters, MTI’s daily newsletter.