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March 21, 2023

Budgetary surplus in October, deficit at 10 months drops to RON 7.6 bln

The general consolidated budget posted a surplus in October, while the deficit at 10 months diminished from RON 8.1 bln to RON 7.6 bln, respectively 1.21 percent of the GDP, less than half the deficit target – 2.5 percent of the GDP – negotiated for this year with the International Monetary Fund (IMF). “If incomes stay on schedule, the end-year deficit could be slightly lower than the value set through the rectification, but the good news is that we will certainly range within the deficit target negotiated on cash. It is also a welcome reserve for the ESA deficit, which will be finalised next year, after treating again states companies,” the delegate minister for Budget, Liviu Voinea told Mediafax.
At the beginning of November, Romanian authorities negotiated with the IMF a new deficit target for this year, up from 2.3 percent to 2,5 percent of the GDP, a difference that will be exclusively reflected by the supplementary expenses with co-financing the projects made from European funds. The budgetary execution for October posted a surplus of RON 577.8 M, mainly due to profit tax incomes achieved in Q3, according to data released by the Ministry of Finance. The incomes to the general consolidated budget amounted to RON 166.7 bln (26.7 percent of the GDP) in the first 10 months and were 4.6 percent higher in nominal figures than during the same interval of 2012. Incomes from the profit tax advanced by 1.5 percent against the similar period of 2012, while those from the income tax went up 7.8 percent due to the increase of salary incomes, driven by the restoring of the incomes of state employees and the increase of the minimum wage as of February 1st 2013 and respectively July 1st 2013.
VAT incomes went up 4.2 percent, while incomes from excise duties were 3.4 percent higher, driven by the increased excise duty on diesel fuel, beer and cigarettes, as well as by the exchange rate used for the payment of taxes. The sums paid by the European Union to the account of past payments continued their upward trend, as they exceeded by 18.9 percent those of the previous month. The expenses from the general consolidated budget amounted to RON 174.3 bln (27.9 percent of the GDP), 4.6 percent higher in nominal figures than at 10 months of 2012, but their weight in the GDP diminished by 0.5 percent points.
The expenses with the personnel increased by 14.5 percent, influenced by the restoration of the wages of state employees and by the payment of obligations set by court decisions. In their turn, the expenses with goods and services advanced by 11.9 percent, driven by the legal measures and the resources allocated for the payment of arrears accumulated by local administrations, as well as the payment of hospitals’ arrears. The spending with investments, which includes capital expenses and those pertaining to the development programmes financed from internal and external sources, topped RON 22.6 bln, respectively 3.6 percent of the GDP.

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