Surplus at 1.3% of GDP in H1 2019

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Preliminary data show that the surplus of the general government sector in the first half of 2019 was HUF 295 billion, equivalent to 1.3% of GDP. The balance improved year-on-year by HUF 530 bln, or by 2.4 percentage points as a proportion of GDP, the Central Statistical Office (KSH) reports.

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In H1 2019, compared to the corresponding period of 2018, revenues of the general government sector totaled HUF 9.843 trillion, while expenditures amounted to HUF 9.548 tln.

Revenues went up by HUF 864 bln year-on-year, an increase of 9.6%. The largest, HUF 319 bln (8.6%) increase in value was recorded in taxes on production, within which VAT revenues grew by HUF 186 bln (up 9.7%). Revenues from taxes on income were HUF 196 bln (14.1%) higher than a year earlier. Social contributions rose by HUF 222 bln (8.6%). Other revenues increased by HUF 125 bln (up 9.4%).

Meanwhile, expenditures increased by HUF 334 bln, or by 3.6%. The growth in the case of gross fixed capital formation was HUF 213 bln (up 24.4%), and HUF 88 bln (6.2%) regarding intermediate consumption. Paid compensation of employees went up by HUF 112 bln (5.1%), while social benefits other than social transfers in kind increased by HUF 51 bln (up 2.1%). Interest expenditures grew by HUF 28 bln (up 5.8%). Other general government sector expenditures were reduced by HUF 158 bln (down 8.8%).

The KSH also released data for the second quarter of 2019 alone. In Q2 2019, compared to Q2 2018, the general government sector had a surplus of HUF 210 bln, representing 1.8% of GDP. The balance improved by HUF 359 bln, or by 3.2 percentage points compared to the corresponding period of the previous year.

Revenues increased by HUF 549 bln (up 11.8%) in Q2 2019, while expenditures were HUF 190 bln (3.9%) higher year-on-year.

Meanwhile, a second release of preliminary data of national accounts for 2018 shows that the deficit of the general government sector last year amounted to HUF 976.5 bln, equivalent to 2.3% of GDP.

The KSH reported the data to Eurostat, the statistical office of the EU, in compliance with the regulation on the Excessive Deficit Procedure (EDP), according to the methodological requirements included in the European System of Accounts (ESA 2010). The debt of the general government sector at the end of 2018 – based on data from the National Bank of Hungary (MNB) – was HUF 29.951 tln, equivalent to some 70.2% of GDP.

The balance of the general government sector for Q1-Q3 2019, and for the third quarter alone, will be published in January 2020.

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