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Aug 07, 2017

Hungary’s budget deficit hit 2.65 billion euros in July

Hungary's cash flow-based budget, excluding local councils, ran an 816.8 billion HUF deficit at the end of July

Hungary’s budget deficit hit 2.65 billion euros in July, according to official figures.

According to preliminary data released by the ministry for National Economy, Hungary's cash flow-based budget, excluding local councils, ran an 816.8 billion HUF deficit at the end of July.

According to the report, the shortfall was 70.03 percent of the 1,166.4 billion HUF full-year target.

The central budget had a 843.7 billion HUF deficit and social insurance funds were 81.8 billion HUF in the red at the end of July.

The ministry said separate state funds ran a 108.7 billion HUF surplus. In July alone, the budget, excluding local councils, ran a 94.4 billion HUF surplus.

Last year in July there was a monthly deficit of 62.7 billion HUF. The seven-month deficit was up from 464.8 billion HUF in the base period.

According to the ministry, the July surplus was achieved primarily because of an increase in tax revenues. There has been substantial growth in VAT revenues, PIT revenues and income from healthcare contributions and payroll tax. Revenue from sales of state-owned farmland also increased income.

The ministry noted the effects of advanced payments from domestic funds for EU tenders raised expenditures. Advanced payments reached 1,090 billion HUF in January-July compared to 601.7 billion HUF for the same period last year.

The state of budget finances is “stable” and the 2.4 percent-of-GDP deficit target for the full year calculated according to EU accounting rules “can be safely achieved”, the ministry added.