Hungary 2018 budget deficit 2.2 pc of GDP, under target

Hungary’s budget deficit, calculated according to the European Union’s accrual-based accounting rules, came to 2.2 percent of GDP last year, the Central Statistical Office (KSH) said on Monday.

Hungary’s government had targeted an ESA 2010 deficit of 2.4 percent of GDP. The government’s deficit target for 2019 is 1.8 percent of GDP.

In absolute terms, the deficit reached 934 billion forints (EUR 2.9bn).

The data show general government revenue rose by 8.5 percent to 18,617 billion forints, while expenditures increased by 8.6 percent to 19,551 billion forints.

On the revenue side, taxes on production rose by 11.8 percent or 811 billion forints, while revenue from taxes on income grew by 2.5 percent or 72 billion forints. Social contributions were up by 5 percent, or 243 billion forints. Other revenues were up by 13.3 percent, or 335 billion forints, mainly because of significant growth in EU transfers, KSH said.

On the expenditure side, compensation paid to employees was up by 5.7 percent or 238 billion forints and social benefits other than social transfers in kind increased by 4.7 percent or 218 billion forints.

Gross fixed capital formation jumped by 39.7 percent or 693 billion forints and other expenditures were up by 13.3 percent or 435 billion forints.

KSH said that Hungary’s public debt, based on data from the National Bank of Hungary (NBH), stood at 29,807 billion forints at the end of 2018, equivalent to 70.8 percent of GDP.

Speaking at a press conference after the data was published, Finance Minister Mihály Varga noted that Hungary had a primary surplus in 2018 (spending was less than revenue without the cost of debt maintenance). Interest spending came to 1,066 billion forints in 2018. Hungary has had primary surpluses every year since 2012.

Source: MTI