Hungary's central budget revenues was less than half of the downward modified annual target by the end of June, and expenditure exceeded the pro-rata of the upped full-year target, recently published detailed H1 central government figures.
Among traditional tax revenues sources, corporate tax revenue surpassed 50% of its lowered annual target, but revenues from VAT and excise duties or personal income tax were below plans, the detailed figures show.
First-half central budget revenues on the whole stood at HUF 3,808.4 billion, or 47.0%, of the new full-year target and central budget expenditure, at HUF 4,715.8 billion, reached 51% of the respective plan.
H1 expenditure did not yet include the state's EUR 1.88 billion purchase of a 21.2% stake in MOL. The transaction, announced late May, was closed in July.
Hungary's Parliament recently upped the 2011 Budget Act's expenditure target by HUF 488 billion to reflect the MOL deal, and raised the cashflow deficit target from HUF 687.4 billion to HUF 1,184.2 billion. Another recent amendment cut budget expenditure and revenue by a similar HUF 182 billion, as Parliament approved finalization of the withdrawal of budget allocations frozen in February final, and cut revenue targets -- including corporate tax and VAT revenue targets -- by a similar amount.
The uneven timing of one-off site, including the HUF 529 billion budget revenue due to the central budget and the National Pension Fund from the assets transfer of private pension funds, explained part, but not all, of the pro-rata revenue shortfall in H1.
Among other non-standard revenue sources, January-June revenue from the extraordinary banking levy totaled HUF 89.7 billion, or 48%, of the HUF 187 billion full-year target, reflecting that the second installment of the tax fell well short of the first, HUF 50.7 billion, payment. Companies in the financial sector have to pay the extra tax in four installments.
The budget yet saw only HUF 18 billion of the HUF 161 billion revenue to be collected from the crisis taxes levied on the telecom, energy and retail sectors during the year by the end of June.
Corporate tax revenue, at HUF 144.9 billion in H1, exceeded the pro-rata target by 0.3 percentage points. The recent amendments reduced the annual target by HUF 84 billion to HUF 288 billion.
Six-month revenue from VAT totaled HUF 1,115.2 billion or 44.8% of the full-year target, and revenue from excise tax, at HUF 395.8 billion was at 44.9% of the respective full-year target. Parliament cut the VAT revenue target by HUF 69 billion and left the excise duty revenue plan unchanged.
Revenue from personal income tax totaled HUF 709.4 billion in January-June, 0.9% less than the half of the unchanged annual target, and revenue from various duties and fees, at HUF 37 billion, was at 45.2% of the annual plan, which was cut by HUF 6 billion.
On the expenditure side, interest rate expenditures showed the largest overshoot, reaching HUF 637.9 billion, or 59.8%, of the annual target in H1. Parliament recently upped the respective expenditure plan by HUF 15 billion.
Spending on income supplement and social support, at HUF 72.9 billion in January-June, was slightly above, while family support, of HUF 227.3 billion, was slightly below the pro rata amount.
Spending on price subsidies, at 52% of the full-year total, reached HUF 56.7 billion, and public media related spending, at HUF 29.9 billion, or 51%, was also above the pro-rata target.
Revenues at the National Pension Fund stood at HUF 1,335 billion, or 43.4%, of the full-year plan in January-June -- the fund is to get its HUF 434.3 billion due from the private pension fund assets only in H2. Revenue of the fund from pension contributions, at HUF 1,290.9 billion, even slightly exceeded the pro rata amount by the end of June, and its spending, at HUF 1,511.2 billion, was below pro-rata at 49.2%.
Health Fund revenues in January-June came to HUF 703.6 billion, or 51.3%, of the full-year target, although revenue from employers' and employees contributions were slightly below that planned. Health Fund expenditures, at HUF 716.2 billion, were 0.9 percentage points below the proportional target.
There were pro-rata overshoots in spending on drug subsidies (HUF 188.7 billion or 54.9% of the full-year target), subsidies on healthcare accessories (HUF 24.5 billion or 54.6% of the target) and administrative costs (HUF 5.8 billion or 58.6%).
Expenditures by the Labor Market Fund reached HUF 137 billion, or 43.9%, of the full-year target in January-June, with HUF 70.6 billion or 52.1% of the yearly target spent on passive employment tools -- mainly unemployment benefits. The HUF 27.4 billion spent on public work schemes, was well below 50% the HUF 64 billion full-year budget of the schemes undergoing a restructuring.