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Bucharest
December 3, 2021
BUSINESS

Budget deficit at 4 months advanced to 1.2 pc of GDP

The budget deficit advanced from RON 4.19 bln at the end of March to RON 7.5 bln (1.2 pc of the GDP) after four months and stays within limits that do not endanger the target agreed with international partners, the Ministry of Finance informs. “In April, following the early payment of salary rights for April, a deficit increased was reported, an influence of approximately 0.2 percent points, with seasonal character that will be recovered in May. Thus, in absence of these early payments, the budget deficit on the first four  months would have been 1 pc of the GDP, compared to 0.85 pc of the GDP in the similar interval of 2012,” the institution informs. This deficit also reflects the restoration of salaries in the state sector, the indexing of pensions, the refunding of the contributions paid by pensioners to the social health insurances, the increase of the minimum wage and the reduction of arrears. The budget for this year was constructed with a deficit target of 2.1 pc of the GDP. The incomes to the general consolidated budget after the first four months, worth approximately RON 65 bln, representing 10.4 pc of the GDP, were 4.3 higher in nominal terms than in the same period of the previous year.
The excise duties advance (+13 pc) following the increase of the excise duty for diesel fuel and the exchange rate taken into consideration when excise duties were calculated, as well as because of the implementation of administrative reforms aimed at improving the collection rate, the FinMin explains. Local administrations also registered 9.0 pc increases compared to the previous year in terms of property taxes and dues.
The sums received from the European Union to the account of made payments further register a relatively low level, representing 0.3 pc of the GDP, but they maintain the ascending evolution and are 196 pc higher than the previous month. The spending of the general consolidated budget, worth RON 72.5 bln, accounting for 11.6 pc of the GDP, increased in nominal terms by 7.6 pc against the same interval of last year. Increases were registered in the personnel expenses category (+28.2 pc) as a consequence of the restoration of salaries in the state sector, and also due to the early payments of salary rights for April to some categories of employees in the public sector. Expenses with investments, which include capital expenses, and those pertaining to the development programmes financed from internal and external sources, amounted to RON 9.7 bln (1.55 pc of the GDP). Capital expenses at four months increased by 0.1 pc of the GDP compared to the similar interval of the previous year.

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