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Business Cyprus

Government produces €327m surplus in H1

File photo: Inland Revenue Department

The government generated a fiscal surplus of €3269m on a cash basis in the first half of the year compared to a surplus of €64.5m the year before, the finance ministry said.

The increased surplus was mainly on a €208m increase in revenue in January to June and a €9m reduction in spending to over €3.4bn and below €3.2bn compared to the respective period last year, the ministry said in a statement.

Revenue rose in the first half of the year mainly on a €167m increase in indirect tax revenue to €981.7m, accompanied by a €70m and a €54m rise in direct tax revenue to €892.5m and social security contributions to €617.4m compared to the respective period of 2017, the ministry said. This increase more than offset a €120m slump in non-tax revenue to €345.9m.

The reduction in spending in January to June resulted from a €69m drop in interest payments to government debt to €200.7m accompanied by a €7m drop in capital expenditure to €86.2m compared to a year before, the ministry said. This more than offset a €31m increase in public wages to €842.4m and a €19m rise in social security outlays and a €7m increase in pensions to €278.5m.

The primary surplus in the first six months of the year rose to €528.5m from €287.5m a year before, the ministry said. The figure is the difference of total revenue and spending excluding interest payments.

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