The general government budget deficit in Romania contracted by 57% y\/y to nearly RON 24 billion (EUR 4.7 billion) in January-April, according to data published by the Finance Ministry. The deficit to GDP ratio decreased to 1.17% from 2.92% in the same period of last year.\u00a0<\/p>\n
The detailed figures confirm positive developments in the execution of the budget, but a large part of the consolidation was achieved due to lower investments from the national budget and loans in the first four months this year \u2013 by some RON 10 billion, or nearly one-third of the annual decrease in the overall budget deficit.\u00a0<\/p>\n
The lower investments this year are explained by the Finance Ministry as a base effect after outstanding payments in the first months of last year \u2013 delayed payments to contractors, one-off defence spending, and the disbursement of the state\u2019s capital contribution to Carpatica Feroviar state railway company. This means that last year\u2019s deficit was artificially increased by these one-off payments and the fiscal consolidation (-57% y\/y) overstates the fundamental improvement achieved by the government\u2019s policies \u2013 but, still, the low absolute value of the deficit in the first four months of the year (1.17% of the GDP projected for the whole year) remains an outstanding performance paving the way for meeting the full-year 6.2% of GDP target.<\/p>\n
The revenues to budget increased by 12.0% y\/y to RON 223.8 billion (10.9% of the year’s projected GDP, up from 10.4% in the same period last year), and the tax revenues alone rose by 15.5% y\/y. Particularly, the VAT collection increased by 22.4% y\/y, contributing more than a third to the overall RON 23.9 billion increase in revenues.\u00a0<\/p>\n
Higher VAT rate this year compared to January-April last year, and the inflation nearing 10% contributed to this, as the retail sales decreased in volume terms.\u00a0<\/p>\n
The social security contributions also increased by 8.8% y\/y (+RON 6.0 billion), contributing a quarter of the overall advance of the budget revenues. The personal income tax surged by 22% y\/y (+4.3 billion), possibly as a result of the tax being waived on fewer taxpayers, and the tax on property surged by 31% y\/y (+2.2 billion) as a result of higher tax rates set by local administration.\u00a0<\/p>\n
The expenditures contracted by 3.2% y\/y to RON 247.8 billion in January-April, accounting for 12.1% of GDP projected for the whole year, down from 13.4% in the same period last year. The fiscal consolidation was thus predominantly driven by the expenditure side.\u00a0<\/p>\n
The 49% y\/y decline in the capital expenditures from the national budget (-9.0 billion) was larger than the RON 8.1 billion decrease in overall budget expenditures. Notably, the public payroll decreased by 3.3% y\/y and the social security by 1.0% y\/y.\u00a0<\/p>\n
The expenditures related to projects financed by grants under RRF\/PNRR doubled y\/y (+RON 4.2 billion), and the expenditures related to projects funded by loans under RRF\/PNRR decreased by 25% y\/y (-RON 1.4 billion).\u00a0<\/p>\n
iulian@romania-insider.com<\/em><\/p>\n (Photo source: Inquam Photos\/Octav Ganea)<\/em><\/p>","protected":false},"excerpt":{"rendered":" The general government budget deficit in Romania contracted by 57% y\/y to nearly RON 24 billion (EUR 4.7 billion) in January-April, according to data published by the Finance Ministry. The deficit to GDP ratio decreased to 1.17% from 2.92% in the same period of last year.\u00a0 The detailed figures confirm positive developments in the execution […]<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-10355","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/ofero.news\/index.php?rest_route=\/wp\/v2\/posts\/10355","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ofero.news\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ofero.news\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/ofero.news\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=10355"}],"version-history":[{"count":0,"href":"https:\/\/ofero.news\/index.php?rest_route=\/wp\/v2\/posts\/10355\/revisions"}],"wp:attachment":[{"href":"https:\/\/ofero.news\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=10355"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ofero.news\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=10355"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ofero.news\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=10355"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}