Romanian budget deficit up to 0.63 pct of GDP to RON 5.1 bln in first seven months

The Romanian budget deficit stood at 0.63 percent of the GDP to RON 5.1 billion in the first seven months of the year. Last year, during the same period, the deficit was of RON 1.74 billion, according to the Public Finance Ministry (MFP).

During January-July, the revenues of the consolidated budget, amounting to RON 141.2 billion and representing 17.3 percent of GDP, were by 9 percent higher in nominal terms than the same period of 2016.

According to the Ministry, there were increases to the revenues in social contributions (16.4 percent) compared with 2016, from the salaries and income tax (10.8 percent) and from the capital revenues (15.2 percent).

On the other hand, the revenues from taxes and taxes on property dropped by 6.5 percent compared with the similar period of 2016, the reduction being determined mainly by the elimination of special constructions tax starting 1 January 2017.

The charges from taxes and taxes on goods and services increased by 62 percent compared with the same period of 2016, the increase being mainly determined by the evolution of charges for the contribution for drugs, as well as for the cost-volum/cost-volum-result financed from the Sole National Fund budget of healthcare social insurances.

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The revenues from VAT registered a drop of 4.6 percent compared with the first seven months of 2016 due to the reduction of standard VAT quota from 24 percent to 20 percent starting 1 January 2016, which was reflected in revenues starting February 2016.

At the same time, starting February 2017,  the reduction in standard VAT quota from 20 to 19 percent started to be reflected in revenues.

The excises charges were by 5.8 percent lower compared with the similar period of 2016, being influenced by their reduction for some energy products starting January 1.

The amounts received from the EU in the payments account were worth RON 6.5 billion.

On the other hand, the expenses of the general consolidated budget, amounting to RON 146.4 billion, increased in nominal terms by 11.4 percent compared with the seven months of 2016.