Romania’s public deficit rose by 52 pct in January-July on soaring wage, pensions spending
Romania’s budget deficit rose by 52 percent in January-July compared with the first seven months of last year, to RON 18.1 billion (EUR 3.8 billion), as the government has major difficulties to cover soaring wage and social spending.
In January-July 2018, the budget deficit amounted RON 11.9 billion.
Official data show that budget revenues rose by 12 percent year-on-year in January-July up to RON 180.07 billion (EUR 37.9 billion) while expenses increased by 14.7 percent to RON 198.2 billion.
The general budget in January-July closed with a deficit of RON 18.1 million, or 1.76 percent of estimated GDP.
Surging wage spending
Revenues from social contributions rose by 16.6 percent, VAT revenues increased by 12 percent, while revenues from income tax – paid by individuals – grew by only 0.4 percent compared with January-July 2018.
In the same time, budgetary wage expenses increased by 21.5 percent against January-July 2018 and capital expenses surged by 23 percent.
Expenses on goods and services increased by 14 percent year-on-year in January-July.
Last year, Romania has registered a budget deficit of 3.02 percent of GDP, slightly exceeding European Union’s ceiling of 3 percent of GDP.
Flat interest expense
Read More: @Business-Review
