In May, the state budget was in deficit by 21,6 million euros, with a significant drop in the collection of the main state revenues from value added tax (VAT) by 5,9 percent and pension insurance contributions by 8,9 percent. The deficit was realized even though the expenses paid amounted to 214,8 million euros, instead of the planned 242 million euros, that is, if all the planned expenses had been paid, the state treasury would have been in the red by 48,8 million euros.
This is shown in the report on the execution of the state budget for May. In the same month last year, the deficit amounted to 3,3 million euros.
A decline in the collection of nine duties
In May of this year, the state treasury earned 193,3 million euros, instead of the planned 202,4 million euros. The decrease in revenue was realized in nine items, while the growth or the same level of collection was in five types of duties. The deficit in May was ten million more than capital expenditures, which means that it also arose from current spending.
EUR 88,2 million was collected from VAT, instead of the expected EUR 93,8 million, which is a decrease of EUR 5,6 million, while EUR 40,7 million was collected from pension and disability insurance contributions instead of the expected EUR 44,7 million , that is, four million less. The decrease in collection, compared to the plan, was from corporate income tax by 1,1 million or 14 percent, from fees by 30,5 million or 2,2 percent, from other income by 51,6 percent or XNUMX, XNUMX percent…
Income growth in May was recorded in excise duties, where 31,7 million euros were collected instead of the expected 27,2 million, and from personal income tax, eight million poured into the state coffers, while the planned amount was 6,4 million,...
Lower income due to VAT refund?
VAT is the main state income from which about 40 percent of the total income flows into the coffers, so any decrease in it is worrying.
The collection of VAT for the entire period January-May was less than the plan by 1,9 million euros or 0,4 percent, which means that the fall in May was greater than the fall for all five months since the beginning of the year.
From the Ministry of Finance, which he heads Novica Vuković, state that the net collection of this tax was affected by the faster VAT refund procedure at the Tax Administration, as well as that a large number of requests for refunds accumulated from the previous period were resolved in May.
"Since January, the Tax Administration has intensified the control and processing of these requests and accelerated the dynamics of refunds from the beginning of 2024, and the aforementioned has a significant effect on stimulating the business environment and removing business barriers in the economy. In this context, for the period January-May, the VAT refund was higher by about 45% compared to the observed period of 2023. In May alone, the VAT refund was higher by about 79%, compared to the same month in 2023," the Ministry stated.
The decline in income from contributions was not explained
They did not explain why the income from contributions for pension and disability insurance fell by 8,9 percent or by four million euros in May. This contribution makes up about 20 percent of total state revenues.
It is illogical that in the same month there is an 8,9 percent decrease in income from contributions to pension insurance, while at the same time there is a 25,9 percent increase in income from tax on the income of natural persons, because both of these duties are charged on the gross salary of employees and depend from the same factors - salary and number of employees.
According to Monstat data, the number of employees in May was 257,5 thousand, which is about 4,5 thousand more than in April, while the average gross salary in this month is about 0,6 percent higher. So both of these data indicate that there should have been an increase in income from pension insurance contributions in May, and not a decrease.
The collection of contributions for PIO in May of this year is even 1,3 million euros lower than the collection for the same month last year, although wages are now five percent higher and the number of employees has increased by 13 thousand.
For the payment of all pensions in May, 61 million euros were spent, that is, 20,3 million euros more than the collected contributions for pension insurance, which is the deficit of the PIO Fund. This means that one-third of the money needed for the payment of pensions is provided from other budget revenues, and not from earmarked contributions.
In the explanation of the Ministry of Finance, only the data on the collection of this contribution for the entire period January-May of this year, when they amounted to 217,4 million euros and were higher by 14,2 or seven percent compared to the plan, are stated.
Growth from excise duty
Revenues from excise taxes were also presented for the entire period when they amounted to 125,6 million euros, which is three million euros or 2,5 percent more than the plan. However, in May alone, the income from excise duties was 4,5 million euros higher than planned, that is, this month it made up for the shortfall in excise duty collection in the first four months, when the collection was one and a half million euros lower than planned.
Most of the revenue from excise duties is this duty on oil derivatives and 67,7 million euros were collected in five months, while 40,5 million euros were received from excise duties on tobacco products, and from all other excise duties on alcohol, sweets, single-use plastics , carbonated drinks, juices with sweeteners,... charged 17,4 million euros.
The government saved on everything except the salaries of officials
Total expenditures in May were 214,8 million euros and were 27,2 million euros lower than planned.
On all items, payments were made less than planned, except for gross wages for employees in the public sector. 59,8 million euros were paid for the salaries of civil servants this month, which is 3,2 million more than planned.
In the case of transfers to public institutions, EUR 13,1 million of planned obligations were not paid, while EUR 5,4 million of planned obligations were not paid in the capital budget. Expenditures for interest are lower than the plan by 6,6 million, for subsidies 2,3 million, for current maintenance 1,7 million, for social protection 1,5 million, for services 1,4 million, for material XNUMX million. ..
39,2 million euros were spent on debt repayment in May, so the total missing funds in the budget for this month amounted to 62,9 million euros. If all expenditures were realized at the planned level, the total deficit would amount to 90 million euros.
The missing funds were provided by reducing deposits by EUR 60,9 million, which were provided by borrowing in March. The rest of the missing funds of two million are covered by property sales, loans and proceeds from loan repayments.
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