Greek Budget: Primary deficit of 1.687 billion in the first quarter of 2022

A deficit of 1,687 million euros, against a target for a primary deficit of 1,331 million euros was recorded by the state budget in the period January – March 2022. Tax revenues amounted to 12,144 million euros, increased by 1,337 million euros or 12.4% against the projected target. According to the Ministry of Finance, this windfall is due to the extension of the deadline for payment of road tax until the end of February 2022, to the better return of the previous year taxes collected in installments at the end of February 2022, as well as because of the better performance in the collection of taxes of the current year. In March 2022, the total net revenues of the state budget amounted to 2,952 million euros, reduced by 416 million euros compared to the monthly target due to the reduced revenues of the Public Investment Budget .

Skylakakis: Revenue rise in March despite the climate due to war

Deputy Finance Minister Theodoros Skylakakis said that “the good course of public revenues continued in March, despite the negative effects on the economic climate from the war waged by Russia against Ukraine. Tax revenue was up 511m euros, or 17.5% over target, which offset the very high revenue returns which were up by 321m euros vis-à-vis the target.” He stressed that “in the coming days, Eurostat data for the 2021 deficit are expected, which are estimated to be significantly better than the budget forecast. According to the calculations of the General Accounting Office, the improvement will probably reach or even exceed 1.5 GDP points.” According to the Deputy Minister, this development is extremely important as it confirms to institutions and markets the prudent management of public finances and allows the rational additional support of households and businesses without increased fiscal risks against the unreasonably high energy prices that the heinous Russian invasion has caused.

In particular, according to the provisional execution data of the state budget, on a modified cash basis, for the period January – March 2022, there is a deficit in the state budget of 3,921 million against a target for a deficit of 3,593 million euros included for the corresponding period of 2022 in the presentation report of the Budget 2022 and a deficit of 5,714 million euros vis-à-vis the corresponding period of 2021. The primary result was a deficit of 1,687 million euros, against a target for a primary deficit of 1,331 million euros and a primary deficit of 3,413 million euros for the same period in 2021.

The net revenue of the state budget amounted to 11,925 million euros, showing a decrease of 1,387 million euros or 10.4% compared to the estimate for the corresponding period included in the 2022 budget report. However, the target of the report included in February the collection of the first installment for 2022 from the Recovery and Resilience Fund (RRF) amounting to 1,718 million euros, which was received on April 9, 2022 and will appear in the State Budget Execution Bulletin for April 2022. Excluding from the RRF, net income increased by 331 million euros or 2.5% against the target, despite the reduced revenue of τηε Public Investment Budget.

The total state budget revenues amounted to 13,228 million euros, reduced by 1,106 million euros or 7.7% against the target. Excluding the above amount from the TAA, total revenue is € 612 million higher than the target.

Tax revenues

Tax revenue amounted to € 12,144 million, up € 1,337 million or 12.4% from the target set out in the 2022 Budget Report. February 2022, in the best performance of the previous year taxes collected in installments until the end of February 2022 as well as in the best performance in the collection of taxes of the current year.

Revenue returns amounted to € 1,303 million, up € 280 million from the target (€ 1,023 million).

Public Investment Budget revenues amounted to € 548 million, down € 697 million from the target (€ 1,245 million).

The exact distribution between the categories of revenues of the state budget will be made with the issuance of the final bulletin.

In particular, in March 2022 the total net revenue of the state budget amounted to 2,952 million euro reduced by 416 million euro compared to the monthly target due to the reduced revenue of the Public Investment Budget.

The total revenue of the state budget amounted to 3,613 million euros, reduced by 96 million euros compared to the estimate for the corresponding period included in the budget report 2022.

Tax revenues amounted to € 3,439 million, up € 511 million or 17.5% from the target due to better performance in tax collection this year, as mentioned above.

Revenue returns amounted to € 661 million, up € 321 million from the target (€ 340 million).

Revenues from the Public Investment Budget amounted to € 2 million, down € 603 million from the target (€ 605 million).

The State Budget expenditures for the period January – March 2022 amounted to € 15,846 million and are reduced by € 1,059 million compared to the target (€ 16,905 million), which is included in the presentation of the 2022 Budget.

On the part of the Regular Budget, there is a lag of 1.51 million euros against the target, which is mainly due to the delay of payments of armaments programs by 459 million euros. There is also a lag in transfers to OKA by 207 million euros, in the current transfers to EU organizations and states by € 188 million and the forfeiture of guarantees by € 147 million.

Payments

Payments on investment expenditure amounted to € 1,902 million, showing an increase compared to the target of € 1,443 million by € 459 million.

The provisional picture of the main payments of the measures against the pandemic for the period January – March, is as follows:

(a) the support of small and micro-enterprises affected by COVID-19 in the Regions amounting to € 150 million from the Public Investment Budget;

b) the public contribution for the repayment of business loans of affected borrowers amounting to € 59 million from the Public Investment Budget;

(c) a working capital subsidy to tourism businesses of € 42 million from the Public Investment Budget; and

d) the special purpose compensation expenditure of € 55 million, paid by the Ministry of Labor and Social Affairs (transfer category).

The state budget expenditures for the period January – March 2022 are reduced, compared to the corresponding period of 2021, by € 1,376 million.