Deficit reaches 64% of full-year target in March

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Hungaryʼs cash flow-based general government, excluding local councils, ran a HUF 871.9 billion deficit at the end of March, the Ministry for National Economy said in a preliminary release of data on Monday. The deficit thus reached 64.1% of the HUF 1,360.7 bln full-year target, news wire MTI-Econews calculated.

The central budget deficit reached HUF 882.8 bln and separate state funds were HUF 16.3 bln in the red, but social insurance funds had a HUF 27.2 bln surplus.

In March alone, the general government deficit came to HUF 345.3 bln.

The ministry noted that pre-financing for European Union-funded projects amounted to HUF 651.7 bln by the end of March, while EU transfers for these projects had reached just HUF 60.8 bln. Additional expenditures were booked for investments funded exclusively from the budget, such as those undertaken in the framework of the Modern Cities Program, it added.

The ministry noted that there was enough room for fiscal maneuver in March to be able to award all Hungarian pensioners a one-off bonus of food vouchers worth HUF 10,000, amounting to a combined value of HUF 27.7 bln.

Revenue from VAT rose by HUF 121.5 bln, revenue from personal income tax was up HUF 66.7 bln, and revenue from payroll taxes increased by HUF 68.6 bln in January-March, compared to the same period a year earlier, the ministry said.

Expanding employment and higher wages have raised budget revenues, in spite of tax cuts and preferences that have left more in the pockets of Hungarian families, it added.

"In light of fiscal trends, the government expects to meet the 2.4%-of-GDP deficit target and further reduce state debt," the ministry said.

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