Minister for National Economy Mihály Varga said it was a historic achievement that the central government budget posted a surplus for the initial two months of the year, as it has been unprecedented since 1998, when the current calculation method was introduced. The surplus of HUF 14.8bn is an evident sign of predictable and responsible fiscal management, he added.

The central sub sector of the state budget closed the first two months of 2016 with a deficit of HUF 63.7bn, while Social Security Funds and Extra Budgetary State Funds posted surpluses of HUF 36.3bn and HUF 42.2bn, respectively. The central sub sector of the state budget had a deficit of HUF 77.4bn in the month of February, well below the HUF 256.9bn deficit in the corresponding period of last year. For comparison: the accumulated deficit of the central sub sector totalled HUF 310.7bn one year ago.

The number of people in employment has been above 4 million for almost two years in Hungary, and thus revenues related to wages and consumption (corporate income tax, VAT, personal income tax, social contributions and duties) have risen steadily. In addition, taxpayer morale has been improved by Government’s anti-fraud measures, such as the EKÁER or on-line cash registers, Mihály Varga noted.

In recent years, state budgets have been characterized by ever lower deficit targets and lower-than-anticipated actual deficit figures. The Minister stated it must be achieved that in the long term the state is operated without a deficit and expenditures are fully covered by revenues, instead of depleting future reserves and generating debt. Thus, more manouvering room remains for economic development and job creation.

For 2016, the ESA deficit of the budget is estimated at 2 percent of GDP. Stable fiscal revenues, the country’s robust economic performance and Government measures aiming to boost economic transparency guarantee this goal, Mihály Varga pointed out.

(Ministry for National Economy)