Serbia's consolidated budget deficit narrowed 25.9% y/y to RSD 83.3bn (EUR 731mn) in January-July 2013 as higher revenue growth offset a mild expenditures increase, data from the finance ministry showed.
The seven-month budget deficit accounted for around 2.2% of the full-year GDP forecast, down from 3.3% a year earlier, according to IntelliNews calculations based on data from the finance ministry.
The consolidated budget revenue rose 6.0% y/y to RSD 829bn in January-July, lifted by higher tax revenue. Spending inched up 2% to RSD 913bn over the period due to rising social transfers, interest and employment spending.
Income from VAT grew 9.9% to RSD 227bn in January-July, reflecting the VAT hike as of October 2012 while social contributions revenue increased 7.3% to RSD 229bn. Income from profit tax remained in the red, shrinking 5.8% y/y to RSD 35bn in January-July, reflecting deteriorated economic environment in 2012 as the economy contracted a real 1.7%.
Spending growth remained subdued as rising social transfers, employment and interest expenditures were partly offset by falling subsidies and goods and services expenses.
Capital expenditures continued retreating, declining by 38% y/y to RSD 38bn in January-July.
Serbia’s parliament endorsed on July 5 the 2013 budget revision, which aims to prevent the consolidated budget gap from exceeding 5.2% of GDP in 2013.
|Serbia's consolidated budget, RSD bn||Jan-Jul'12||Jan-Jul'13||y/y,%|
|--Corporate income tax||37.0||34.9||-5.8|
|--Goods and services||131.2||127.6||-8.1|
|--Social assistance and insurance||370.3||394.4||6.5|
|Source: Ministry of Finance|
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