Hungary budget posts EUR 2.9 bn end-June deficit, 78.12 pc / FY target

Hungary’s cash flow-based budget, excluding local councils, ran a 911.2 billion forint deficit at the end of June, the economy ministry said on Thursday.

The shortfall was 78.12 percent of the 1,166.4 billion forint full-year target.

The central budget had a 902.4 billion forint deficit and the social insurance funds were 110.5 billion forints in the red at the end of June. The separate state funds ran a 101.7 billion forint surplus.

In June alone, the budget posted a 697.9 billion forint deficit.

The six-month deficit was up from a 402.1 billion forint deficit in the base period.

The ministry noted the effects of advanced payments from domestic funds for EU tenders which raised expenditures as the number of beneficiaries was also up. Advanced payments reached 1,046.2 billion forints in H1 compared to 467.4 billion forints last year, and funding allocations from the EU are still far below this level.

Subsidies for home construction projects were also up compared to 2016 and interest payment fees also deserved attention as many payments happened in June, the ministry said.

On the income side revenues related to employment, such as PIT and payroll taxes were higher than expected as was income from itemised small business tax.

The 2.4 percent-of-GDP deficit target for the full year calculated according to EU accounting rules “can be safely achieved” and developments relating to the deficit are in line with plans, the ministry added.

Source: MTI