Cyprus Mail

Government posts fiscal surplus of €9m on cash basis in 2016 (Update)

The government generated in 2016 a fiscal surplus of €9.1m on a cash basis, compared to a €196.4m deficit in 2015, mainly on increased revenue, the statistical service said.

Total revenue rose by €105m in 2016 to almost €6.7bn, Cystat said in a statement on its website on Friday. Total expenditure dropped by €33m to well below €6.8bn.

The increase in revenue was mainly on a €142m rise in indirect tax revenue last year to €2.6bn, including a €104m increase in value added tax revenue to €1.6bn, Cystat said. Social security contributions rose by €46m last year to over €1bn, reflecting an improved labour market situation. Direct tax revenue rose by €2m to €2.1bn, while grants and non-tax revenue dropped by €57m and €28m to €42.3m and €871.9m respectively.

The decrease in expenditure last year was mainly on a €48m decrease in current expenditure to €6.5bn, which included a €94m drop in current transfers to €1.4bn, a €34m drop in interest payments to €509.7m, a €33m drop in not allocated expenditure and a €22m drop in pensions to €577.5m, Cystat said. While subsidies, social security payments and wages, and salaries, rose by €64m, €37m and €23m to €137.9m, €1.6bn and €1.7bn, they were unable to offset the overall drop in government spending.

The fiscal results last year improved also on a €97.6m surplus of local administration authorities, public corporations and other entities, compared to a €1.2m deficit last year, Cystat said.

The primary deficit last year rose to €473.8m from €299m the year before, Cystat said.

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