Albania’s general budget deficit widened by 96.5% y/y to ALL 22.8bn (EUR 162.1mn) in the first four months of 2013, finance ministry data showed. In our calculations, the deficit accounted for 1.6% of the projected full-year GDP, up from 0.9% a year earlier.
Total budget revenues edged up by 0.3% y/y to ALL 106.7bn, which was exclusively due to non-tax revenues that surged by 30.6% y/y. On the other hand, tax receipts dropped by 3% y/y to ALL 94.6bn. The combined revenue from indirect taxes fell by 5.9% y/y, as VAT revenues decreased by 6% y/y with VAT on domestic consumption down by 5.7% y/y and VAT, collected by the customs, dropping by 6.1% y/y. Moreover, revenues from customs duties and excise fell by 9.5% y/y and 5% y/y, respectively. Lower revenues from indirect taxes signal for a continued stagnation of the domestic consumption. By contrast, corporate tax revenues increased by 1.6% y/y and revenues from personal income tax also advanced by 7.6% y/y in Jan-Apr 2013.
On the expenditure side, total budget spending increased by 9.8% y/y supported by a 5.6% y/y rise in current expenditure and a 45% y/y increase in capital expenditure. The latter accounted for 36.5% of the full-year plan, which was higher that the 25.5% share a year earlier. In our view, higher spending on public investments could be partly explained by pre-election expenditures as Albania will hold parliamentary vote on June 23.
The government expects the budget gap to account for 3.4% of the GDP in 2013, higher that the 3% target set for 2012.
General Budget, Jan-Apr, ALL bn | |||
2012 | 2013 | % y/y | |
Total revenues | 106.3 | 106.7 | 0.3 |
VAT | 35.4 | 33.2 | -6.0 |
Corporate profit | 6.3 | 6.5 | 1.6 |
Excise | 10.4 | 9.8 | -5.0 |
Personal income | 9.0 | 9.7 | 7.6 |
National | 9.2 | 8.7 | -4.5 |
Customs duties | 1.8 | 1.6 | -9.5 |
Total social contributions | 20.4 | 20.5 | 0.4 |
Social insurance | 17.3 | 17.0 | -1.8 |
Health insurance | 2.6 | 2.9 | 14.4 |
Non-tax Revenues | 8.1 | 10.5 | 30.6 |
Total expenditures of which: | 117.9 | 129.5 | 9.8 |
Current | 98.1 | 103.6 | 5.6 |
Capital | 17.8 | 25.9 | 45.0 |
Balance | -11.6 | -22.8 | 96.5 |
Balance (% of GDP forecast) | -0.9 | -1.6 | |
Source: Ministry of finance |
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