BRATISLAVA, July 2, (WEBNOVINY) — Slovakia’s state budget deficit in June widened to EUR 2.326 billion. Compared to the previous month, it grew by almost EUR 170 million and was higher year-on-year by 47 percent. According to data released by the Finance Ministry, at the end of the first half of 2012 the budget deficit reached 63.3 percent of its annual budgeted amount.
The deteriorated development of the state budget is caused by slower collection of revenue. Overall revenue of the state budget at the end of June fell year-on-year by 4.3 percent to EUR 5.248 billion, representing 38.5 percent of the amount planned for the whole year. Budget spending over the first half of last year rose by 7.3 percent to EUR 7.573 billion, which is 43.8 percent of the annual budgeted expenditures.
Tax revenue, which constitutes the largest share of total revenue, decreased by 1.8 percent to EUR 4.04 billion. In particular, collection lagged behind of the value added tax, where EUR 2.017 billion was collected, which was 9.3 percent less than the same period of last year. The amount of collected excise taxes was almost unchanged from last year. It only decreased by 0.1 percent to EUR 949.5 million.
The finance department records a more positive development in collected corporate income tax, which grew first half of 2012 by 8.6 percent to EUR 898.9 million. Revenue from withholding tax increased by 21.2 percent to EUR 95.8 million. In collected personal income tax, which is almost entirely transferred to municipal budgets as part of fiscal decentralization, the Finance Ministry at the end of June registered EUR 52.4 million. Non-tax budget revenue increased by 4.4 percent to EUR 356.2 million.
As in previous months, lagging behind are revenues from grants and transfers and among them especially from the European Union budget. Overall, the revenue from grants and transfers dropped by 17.2 percent from last year to EUR 851.8 million. From the EU budget, revenue decreased by 17.5 percent to EUR 1.017 billion.
On the expenditure side of the state budget, current expenditures, which mostly ensure the functioning of government organizations and their wages, increased by 10.1 percent to EUR 6.893 billion. Capital expenditure fell by 15.2 percent to EUR 680.1 million.
The Slovak Parliament last year approved this year’s budget with a deficit of 4.6 percent of GDP. The initial plan counted with a more resolute consolidation of 3.8 percent of GDP, but these plans collided with the continuing financial and economic crisis and also the collapse of the government Iveta Radicova. Current Finance Minister Peter Kazimir says that achieving the deficit of 4.6 percent of GDP will require additional measures.
According to the approved budget, spending is budgeted at EUR 17.3 billion and revenue is budgeted at EUR 13.6 billion. The budget deficit thus can be a hit higher than EUR 3.6 billion.
SITA