Hungarian economy ministry confirms EUR 2.8bn deficit at end-March

Hungary’s cash flow-based budget, excluding local councils, ran an 871.9 billion forint (EUR 2.8bn) deficit at the end of March, the economy ministry confirmed in a second reading of data released on Monday.

The deficit reached 64.1 percent of the 1,360.7 billion forint full-year target.

The central budget had an 882.8 billion forint deficit and the social insurance funds were 27.2 billion forints in the black at the end of March.

The separate state funds ran a 16.3 billion forint deficit.

In March alone, the deficit came to 345.3 billion forints.

The ministry noted that pre-financing for European Union-funded projects had come to 651.7 billion forints by the end of March, up from 252.2 billion forints a year before, while EU transfers for these projects had reached just 60.8 billion forints. Additional expenditures were booked for investments funded exclusively from the budget, such as those undertaken in the framework of the Modern Cities Programme.

Revenue from VAT rose by 121.5 billion forints, revenue from personal income tax was up 66.7 billion at 533.4 billion forints and revenue from payroll taxes increased by 68.6 billion forints in January-March from the same period a year earlier, the ministry said.

Expanding employment and higher wages have raised budget revenue, in spite of tax cuts and preferences that have left more in the pockets of Hungarian families, it added.

“In light of fiscal trends, the government expects to meet the full-year deficit target of 2.4 percent of GDP and further reduce the public debt, helped by an above-4 percent growth in GDP,” the ministry said.

Photo: kormany.hu

Source: MTI