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Cyprus

Government posts €92m deficit in January to July, Cystat says

In the first seven months of the year the government generated a fiscal deficit of €92m on a cash basis, compared to a surplus of €38.5m in the respective period of 2015, the statistical service said.

The deterioration of public finances between January and July attributed to an €86m drop in public revenue, which fell below €3.6bn, outstripping a €21m drop in public spending, to €3.7bn, Cystat said on its website on Friday.

The primary balance, which excludes interest payments on government debt, dropped to a €226.8m surplus, from €383.2m in January to July 2015.

The drop in government revenue was mainly on a €81m decline in direct taxes, which fell to €1bn in January to July, and a €84m slump in non-tax revenue, to €459.8m, Cystat said. The drop was partly offset by an €80m increase in indirect tax revenue, which was below €1.5bn.

The drop in public spending resulted mainly from a €29m saving in pensions, down to €305.7m, and a €29m reduction in interest payments, which fell to €317.8m, combined with a €27m and €21m drop in current transfers and not-allocated expenses to €818.4m and €11.8m respectively.

The drop was partly offset by a €34m increase in social security payments, to €886.9m, a €26m rise in subsidies, to €74.8m, and a €7m increase in wages and salaries, to €921.5m.

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