Macedonia's central government budget deficit narrowed by 48.2% y/y to MKD6.3bn (€102.3mn) in January-April, finance ministry data showed. We estimate that the four-month gap is equal to 1.1% of the projected 2015 GDP, the same as at end-March, as the budget was virtually balanced in April. The full-year deficit target is MKD18.5bn or 3.3% of GDP.
Total budget revenues increased by a real 15.3% y/y to MKD52.2bn in January-April, whereas total expenditure rose by a real 1.8% y/y to MKD58.5bn.
In April alone, the budget posted a small surplus of MKD8mn, reversing a deficit of MKD1.2bn in April 2014. Revenues went up by a real 8.8% y/y to MKD14.4bn, while expenditure edged down 0.1% y/y to MKD14.4bn. The biggest contribution to revenue growth came from profit tax, which jumped 2.6 times y/y to MKD2.2bn. Tax revenues hence climbed 17% y/y to MKD8.7bn, with personal income tax up 11.6% to MKD1.1bn and excises up 4.2% to MKD1.4bn. On the other hand, VAT fell 6% to MKD3.5bn, other taxes dropped 25.1% to MKD60mn, and import duties declined 2.2% to MKD376mn.
In assessing the importance of fiscal policy in Macedonia, one should keep in mind that the country implements a fixed exchange rate regime.
|Central govt budget, MKDmn|
|Budget 2015||Apr'15||% y/y real||Jan-Apr'15||% y/y real|
|TOTAL REVENUES, incl.:||163,280||14,383||8.8%||52,162||15.3%|
|Source: Ministry of finance|
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