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General deficit 36% of full-year target in August, ministry confirms

Telco

Hungaryʼs cash flow-based general government deficit, excluding local councils, reached HUF 274 billion at the end of August, 36% of the full-year target, the Ministry for National Economy confirmed in a second reading of data released today, Hungarian news agency MTI reported.

The central budget ran a HUF 371.7 bln deficit, while the social insurance funds and separate state funds had surpluses of HUF 25.7 bln and HUF 72 bln, respectively. 

In the first eight months of 2015, the deficit was HUF 914.9 bln. The ministry attributed the year-on-year difference in January-August to changes in European Union financing structures. Last year government co-payments to EU-funded programs raised expenditures, but this year EU contributions provided extra revenues of HUF 153.1 bln. The ministry also noted the role of higher tax income from the whitening of the economy.

In the month of August alone, the general government showed a HUF 190.8 bln surplus, compared to a HUF 20.8 bln deficit in the same month a year earlier.

Total revenue for January-August 2016 was HUF 10,745 bln, while expenditure was HUF 11,019 bln, compared to respective figures of HUF 10,424 bln and HUF 11,339 bln for January-August 2015.

Corporate tax income in January-August was HUF 370.9 bln, up by HUF 156.1 bln compared to the first eight months of 2015.

Income from value-added tax was HUF 2,096.9 bln, up by HUF 18.1 bln. Income from excise tax was HUF 638.8 bln, also up by around HUF 4 bln.

Income from tax on financial transactions was down HUF 11.2 bln at HUF 130.7 bln, while income from the special bank levy was down to HUF 36.4 bln from HUF 74.3 bln earlier.

Trends in the real economy, including growing employment, higher real wages and stronger consumption are "meaningfully contributing" to the stability of the budget, according to the ministry. The governmentʼs target of 2% of GDP for the full-year deficit, calculated according to EU accounting rules, "can be securely met," it added.

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