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EU pre-financing lifts deficit to 135% of full-year target

Hungaryʼs cash flow-based general government, excluding local councils, ran a HUF 1,842.4 bln deficit at the end of November, the Ministry of Finance said in a first reading of data on Friday.  The deficit thus reached 135% of the HUF 1,360.7 bln full-year target, news wire MTI calculated.   

Within the general government, the central budget ran a HUF 1,856.1 bln deficit in January-November, the social security funds were HUF 26.1 bln in the red, and separate state funds had a surplus of HUF 39.8 bln.

Alone in the month of November, the general government ran a HUF 164.3 bln deficit.

The ministry noted that government pre-financing for European Union-funded projects reached HUF 1,737.4 bln by the end of November, while transfers from Brussels came to just HUF 574.6 bln.

Expenditures were also lifted by a HUF 41.2 bln top-up of pensions linked to economic growth and continued funding for developments such as road renovations and projects that are part of the Modern Cities Program, it added.

The ministry said revenue from VAT was up HUF 343.6 bln in January-November from the same period a year earlier. Revenue from personal income tax climbed HUF 235.4 bln, payroll tax revenue increased HUF 247.3 bln, and excise tax revenue was up HUF 81.3 bln. 

The governmentʼs deficit target of 2.4% of GDP for the full year, calculated according to the EUʼs accrual-based accounting rules, is still "achievable," alongside economic growth that is "expected to be well over 4%," the ministry said.