Hungary’s budget, excluding local councils, ran a 39 billion forint (EUR 120m) deficit at the end of April, the finance ministry said in a preliminary reading of data on Thursday.
The four-month deficit reached 3.9 percent of the 998.4 billion forint target for the full year.
The full-year accrual-based deficit target of 1.8 percent of GDP is achievable, and public debt could be reduced to below 70 percent of GDP, the ministry cited Finance Minister Mihály Varga as saying.
The January-April deficit was in line with the government’s expectations, the minister said, noting that the central budget’s position is stable and balanced due to the performance of the economy and to rising revenue despite tax cuts.
The budget, excluding local councils ran a 102.9 billion forints surplus in April alone.
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The figures compare to an April deficit of 208.4 billion forints and a four-month deficit of 1,081.4 billion forints in 2018.
A steady rise of employment coupled with rising wages supports the expansion of retail consumption, Varga said according to the press release.
He noted that revenue from VAT rose by 349.3 billion forints, revenue from personal income tax climbed by 55.5 billion forints and revenue from payroll taxes increased by 160.9 billion forints from the same period a year earlier.
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The government continued the pre-financing of EU-funded investments and this continued to impact the balance, Varga said. Payouts for such investments reached 489.3 billion forints during the period, while transfers from Brussels came to just 305.9 billion forints.
The government also spent significant central budget funds to support developments in the framework of the Modern Cities Programme, as well large corporate investments that expand capacity and create jobs.
In the featured photo Finance Minister Mihály Varga. Photo by Tamás Kovács/MTI