Nine-month gen gov’t deficit reaches HUF 2.4 bln, ministry confirms

Telco

Hungary’s cash flow-based general government deficit, excluding local councils, reached HUF 2.4 billion at the end of September, the National Economy Ministry confirmed in a second reading of data released today. The deficit compares to a full-year target of HUF 761.6 bln.

The government has decided to cut Hungary’s deficit target, calculated according to EU accounting rules, to 1.7% of GDP from 2% in light of the better than projected performance in the first nine months, the economy ministry announced when releasing the preliminary figures earlier this month. 

The central budget ran a HUF 95.5 bln deficit, while the social insurance funds and separate state funds held surpluses of HUF 21.3 bln and HUF 71.8 bln, respectively.

The nine-month deficit was the lowest in one and a half decades, and compares to a HUF 954.6 bln deficit one year earlier.

In September alone, the general government ran a HUF 271.6 bln surplus, compared to a HUF 39.7 bln deficit a year earlier.

Explaining the big shift, the ministry said that this year the European Union had transferred the big payouts the central budget made to successful applicants in 2015 before the end of disbursement of funding for the 2007-2013 EU budgetary period. Besides, the budget’s position has been extraordinarily stable due to higher revenues and lower expenditures this year, it added.

The ministry said that the stable budget position was one of the main reasons for Hungary’s recent upgrade back to investment grade by international ratings agencies Fitch Ratings and Standard & Poorʼs.

Total revenue for January-September 2016 was HUF 12.532 trillion and expenditure was HUF 12.534 tln, compared with HUF 11.827 tln and HUF 12.782 tln respectively in January-September 2015.

Corporate tax income in January-September was HUF 388.2 bln, up by HUF 155.3 bln compared to the first nine months of 2015.

Income from value-added tax was at HUF 2.419 tln, up by HUF 46 bln. Income from excise tax at HUF 744.9 bln was also up by around HUF 32.1 bln.

Income from financial transaction tax was down HUF 5.3 bln at HUF 151.9 bln and income from the special bank levy was down at HUF 53.9 bln from HUF 111.4 bln earlier.

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