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Cyprus

Government generates a 1% fiscal gap in January to November

By Stelios Orphanides

The government generated a fiscal deficit on a cash basis of €174.1m in January to November, roughly 1 per cent of the economy, compared to a €225.4m surplus a year before mainly on decreased revenue, the finance ministry said.

Overall revenue fell an annual 3.5 per cent to over €5.6bn in January to November, mainly on decreased non-tax revenue, the ministry said in statement on its website on Thursday. Direct tax revenue fell 5.2 per cent to €1.7bn while indirect tax revenue rose 1.4 per cent to €2.2bn. Social security contributions rose 3.7 per cent to €891.7m, while non-tax revenue fell 15 per cent to €716.6m.

Overall expenditure rose 2.8 per cent to €5.3bn in the first eleven months of the year compared to the respective period of 2014, the finance ministry said. The rise in spending was on increased current transfers which rose 13 per cent to well below €1.4bn, offsetting a 1.7 per cent saving in public wages, which fell to €1.4bn and a 3.5 per cent drop in social security outlays. Spending on pensions rose 1.2 per cent to €514.9m while that on goods and services rose 0.9 per cent to €338.7m.

The primary balance until November, which excludes interest payments, was a €326.1m surplus, which is less than half of the primary surplus of €675.2m the government generated a year before, the ministry said. Interest payments in the first eleven months the year rose an annual 11 per cent to €500,1m. Public debt at the end of November stood at almost €19.4bn which is 4.8 per cent higher compared to the respective period of 2014.

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