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Gen gov't finishes January with surplus

Debt

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Hungary's cash flow-based general government, excluding local councils, had a HUF 151.3 billion surplus at the end of January, state news wire MTI reports citing a preliminary reading of data by the Ministry of Finance. 

The central budget had a surplus of HUF 84.4 bln. Separate state funds were HUF 34.3 bln in the black and the social insurance funds had a HUF 32.6 bln surplus.

The general government has had January surpluses for several years. 

The full-year cash flow-based general government deficit target is HUF 3.153 trillion.

The ministry noted that the government earlier reduced the full-year general government deficit target, calculated using the European Union's accrual-based accounting rules, to 4.9% of GDP, from 5.9% in the 2022 budget act. The measure was made possible because the re-start of Hungary's economy is "one of the fastest in the EU", the ministry said, adding that the postponement of some HUF 755 bln in investments will support the achievement of the new target and "allow Hungary to return to a path of balance earlier than planned".

The ministry said last year's economic growth, the highest in 30 years, "provides the foundation for the continuation of tax cuts and the strengthening of families".

"This year, the government has reduced taxes by HUF 1.5 tln, including a [personal income] tax rebate for families, a PIT exemption for under-25s and a HUF 750 bln cut in taxes on labor. Additionally, resources have been allocated for a pension increase, the payment of a pensioners bonus and pay increases affecting most branches of the economy," it added. 

The ministry pointed to a more than 19% increase in the monthly minimum wage from January 1, 2022, to HUF 200,000 for unskilled laborers and HUF 260,000 for skilled workers. At the same time, the ministry said the government had raised salaries for nurses, doctors, creche staff, social and cultural sector workers, soldiers, police, and teachers. Hungarians in the military and law enforcement will also get a bonus, it added.

Pensions rose by 5% from January 1, while pensioners are also getting an annual bonus equivalent to a full month's pension, the ministry said.

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