Turkey’s central government budget posts €2.4bn deficit in March

By bne IntelliNews April 15, 2015

The central government budget ran a deficit of TRY6.8bn (€2.4bn) in March, 34% y/y up from TRY5.1bn of deficit a year ago as expenditures rise more than revenues in the month.

The central budget also posted a primary deficit of TRY655mn in March versus a TRY538mn primary surplus in March 2014, the ministry of finance said on April 15.

Expenditures increased by 7.3% y/y while revenues showed a 3% y/y rise in March, according to data of the ministry. On the expenditure side, interest expenditures rose 9.9% y/y while non-interest expenditures rose by 6.8% y/y. Commenting on the March budget realizations, finance minister Mehmet Simsek said that he expects a strong budget performance in the coming months due to a recovery in domestic demand.

On the revenues side, tax collection rose 17.2% y/y with VAT revenues declining 2.7% y/y, and VAT collection on imports rising 14.3% y/y and SCT revenues rising 30.2% y/y.

The government targets TRY20.96bn of deficit (of 1.1% of GDP) and TRY33bn primary surplus this year.

In Q1, the budget deficit jumped by 258% y/y to TRY5.4bn while the primary surplus rose 1.6% y/y to TRY12.7bn. Expenditures increased by 12.1% y/y and revenues rose by 8.5% y/y in January-March.

CENTRAL GOVERNMENT BUDGET REALIZATIONS        
Thousand TRY  Mar-15 y/y, % Q1-15 y/y, % 2014 Realization 2015 Budget
Budget Expenditures  39,761,196  7.3  118,613,923  12.1  448,423,971  472,942,746
1-Excluding Interest  33,573,405  6.8  100,522,545  9.4  398,516,770  418,942,746
    Compensation of Employees  9,881,832  11.1  32,341,643  10.1  110,370,074  119,170,124
    Social Security Contributions  1,610,182  7.0  5,454,576  8.3  18,926,444  20,324,876
    Good and Service Purchase  3,205,525  16.4  7,337,435  15.4  40,691,137  41,152,681
    Current Transfers  12,971,923  (8.9)  41,746,873  0.3  162,326,920  176,424,780
    Capital Expenditures  3,232,537  14.9  7,262,187  28.2  48,001,296  40,955,159
    Capital Transfers  420,265  (15.6)  1,793,750  78.5  7,683,073  6,797,889
    Lending  2,251,141  212.9  4,586,081  66.7  10,517,826  10,544,604
    Reserve Appropriation  -       -       -    3,572,633
2-Interest  6,187,791  9.9  18,091,378  29.5  49,907,201  54,000,000
Budget Revenues  32,918,115  3.0  113,180,699  8.5  425,758,290  451,979,400
1-General Budget Revenues  31,567,650  3.0  108,689,199  8.4  409,191,031  440,997,857
    Taxes  26,796,761  17.2  96,286,438  13.2  352,436,834  389,501,090
    Property Income  606,703  1.8  2,007,702  (15.8)  16,118,618  9,478,311
    Grants and Aids and Special Revenues  171,451  (28.5)  888,524  32.2  1,891,117  1,932,183
    Interest, Shares and Fines  2,115,607  (55.9)  7,389,382  (12.6)  28,293,680  28,843,105
    Capital Revenues  1,758,632  16.1  1,987,029  (33.1)  9,548,325  10,438,998
    Collections from Loans  118,496  (81.2)  130,124  (80.6)  902,457  804,170
2-Special Budget İnstitutions  1,157,026  (0.5)  2,755,561  4.2  13,419,496  7,789,211
3-Regularity & Supervisory Institutions  193,439  17.5  1,735,939  23.6  3,147,763  3,192,332
Budget Balance  (6,843,081)  (34.4)  (5,433,224)  (258.2)  (22,665,681)  (20,963,346)
Primary Balance  (655,290)  (221.7)  12,658,154  1.6  27,241,520  33,036,654
Source: Ministry of Finance            
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