The general government deficit in Slovakia is expected to reach 4.62% of gross domestic product (GDP) this year, according to a current report on macroeconomic development approved by the cabinet of Prime Minister Robert Fico on Wednesday, December 19.
The government's key fiscal objective should thus achieve a slightly better result than the approved budget for this year where the Finance Ministry foresaw a deficit of 4.64% of GDP. The predicted positive performance by the government should be influenced by spending cuts, for example in funds earmarked for financing joint programmes in Slovakia and the EU of €203 million associated with lower-than-expected use of EU funds this year. General government revenues will be about €154 million higher - by received grants of local governments, public universities, and the state budget. The ministry calculated the effect of transferred spending limits at €114 million and cost saving in the Operational Program Transport beyond co-financing at €120 million.
"Lower spending on social insurance saved €84 million, mainly associated with lower spending on early retirement pensions," the SITA newswire quoted the finance department. On the other hand, the sum of negative influences amounts to €767 million: lower revenue from tax and payroll levies, that also include, however, the positive impact of the consolidation package, represents the amount of €321 million. Without the impact of legislative changes, the shortfall would have reached €609 million. Finance Minister Peter Kažimír reported already in late November that tens of millions of euros will be missing in this year's and next year's budget. The reason is a weaker collection of taxes.
Compiled by Zuzana Vilikovská from press reports
The Slovak Spectator cannot vouch for the accuracy of the information presented in its Flash News postings.
20. Dec 2012 at 0:00