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Stimulus lifts gen gov't deficit to HUF 2.922 tln in October 

Debt

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Hungary's cash flow-based general government deficit, excluding local councils, reached HUF 2.922 trillion at the end of October, widening on stimulus measures, the Finance Ministry said in a preliminary reading of data on Tuesday.

"The government is continuing its crisis management based on support for families, tax cuts, and investment incentives, thanks to which the re-start of the Hungarian economy has been among the fastest in the European Union," the ministry said.

"Revenues have been significantly influenced by employer preferences rolled out because of the coronavirus pandemic, higher wage outflows, and an increase in average earnings," it added. 

The central budget deficit reached HUF 2.704 tln at the end of October, the social insurance funds were HUF 265.1 billion in the red, and separate state funds had a surplus of HUF 47.3 bln.

The deficit widened by HUF 630.2 bln from a month earlier.

The ministry said revenue from corporate tax, VAT, personal income tax and social insurance contributions rose in January-October from the same period a year earlier. Revenue from employers' social security contributions fell because of a two-percentage-point reduction in the payroll tax introduced from July 2020, it added.

Detailing expenditures during the period, the ministry said HUF 172.9 bln was spent on road developments, HUF 156 bln on the Hungarian Villages Program and HUF 153.8 bln on transport sector programs. Support for boosting competitiveness amid the pandemic added up to HUF 94.7 bln, while HUF 78.8 bln was spent on tourism developments, HUF 78.5 bln on railway developments and HUF 66.2 bln on farm subsidies, it added.

Support for employment of people living with disabilities reached HUF 35.2 bln and HUF 29.7 bln went toward the Healthy Budapest Program.

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