Hungary’s general government budget deficit, under the accrual-based ESA95 methodology, narrowed by 10.9% y/y to HUF 256.6bn (EUR 824.6mn) in the first quarter of 2014, accounting for 3.6% of the quarterly, seasonally adjusted GDP, the statistics office said. The higher gap came as revenues grew by 9% y/y, faster than expenditures that advanced by 7.1% y/y.
Government spending on intermediate consumption and compensation of employees increased by 14.8% y/y and 6.1% y/y, respectively. Gross fixed capital formation surged by 42.7% y/y, which was mainly due to investments in road and rail infrastructure. Social benefits, other than social transfers in kind, increased by 1.6% as well. Other expenditure increased by 10.9% y/y. On the other hand, interests payments edged down by 0.9% y/y in Q1.
On the revenues side, current taxes on income and wealth, which broadly refer to personal and corporate income taxation, were up 7.9% y/y. Revenues from taxes on production and imports, rose by 9.9% y/y. Within this receipts from VAT advanced by 14.7% on the year, which could be attributed to the strengthening of domestic consumption. Social contributions went up by 9.5% y/y.
Hungary's general government sector ran a deficit of HUF 687.6bn (EUR 2.2bn) in 2013, accounting for 2.4% of the GDP. The government targets an ESA95 deficit of 2.9% of GDP in 2014.
Related Articles
Druzhba oil flow to Slovakia and Hungary is renewed
The oil flow from the Russian Druzhba pipeline was renewed late on August 19. “The flow of oil to Slovakia is standard at the moment,” the country’s Minister of Economy Denisa Saková (Hlas) ... more
US Westinghouse could develop electricity storage site near Slovak Gabčíkovo hydroelectric power plant
US power company Westinghouse is reportedly in talks with the Slovak government to develop a new type of electricity storage site near the Gabčíkovo hydroelectric power plant (HPP) on the Danube ... more
Viktor Orban hints at possible EU exit scenario in conversation with hard-right platform
Prime Minister Viktor Orban said Hungary's EU membership remains worthwhile for now, but there could come a time when this changes. "There could theoretically be a point when it's no longer worth ... more