Finance Ministry says state budget nearly ideal

07 September 2012

Finance Ministry says state budget nearly ideal The state of the national budget in the first eight months of the year is nearly ideal, as 66.8 per cent of revenues and 67.3 per cent of expenditures have been realised, so the planned deficit by the end of the year will not require a budget revision, the Finance Ministry said on Friday.

Budget revenues in said period were HRK 72.7 billion, up 3.4% from last year. Tax revenue was HRK 42.6 billion, a little below plan, but revenue from contributions was HRK 25.4 billion, 800 million above plan.

Expenditures reached HRK 79.9 billion, up 0.3% from last year.

The budget deficit is HRK 7.2 billion, as planned.

Expenditures for employees stood at HRK 15.1 billion, 700 million above plan, but the ministry is confident it will keep them in check by the end of year, by further slashing salaries in public services if necessary.

Education, interior and justice ministers, who crossed the limits for employee costs, will have to make cuts, but the Finance Ministry is confident no department will be without money for salaries in December.

The tax office received 12,718 requests for the rollover of debts totalling HRK 6.1 billion. The office approved 5,495 requests, approving the rollover of HRK 2.5 billion.

The Finance Ministry reiterated that the Property Tax Act would go into force early next year to enable the tax relief of salaries. Health care is expected to be financed from this tax, which will enable the government to gradually reduce health care contributions to seven per cent.

The property tax will not serve to increase the budget or hit citizens of average wealth, the ministry said.