Thursday, 17 April 2014

FinMin: State budget posts CZK 42.4bn surplus in January

4 February 2013

Prague, Feb 1 (CTK) - Czech state budget ran a surplus of Kc42.4bn in January, double the amount in January 2012 and the highest January surplus since 2000, the Finance Ministry told CTK Friday.

The full-year budget has been approved with a Kc100bn gap. Last year the budget had a deficit of Kc101bn.

"Conclusions for the entire year cannot be drawn on the basis of the January data," commented Finance Minister Miroslav Kalousek.

"Besides, the effect of the VAT change as of January 2013 has not been reflected in the January figure," he said.

VAT rates increased by 1 percentage point to 15 and 21 percent as of January.

"The record-high January figure looks impressive but from a full year point of view, it doesn't play a big role," UniCredit Bank analyst Pavel Sobisek told CTK.

January is not a typical month of the year when it comes to the state budget data, according to him. This year's data will be influenced by tax changes and so it is hard to predict the full-year result, said Sobisek.

Budget revenues amounted to Kc125bn, Kc24.8bn more from January 2012, and budget expenditures grew by Kc3.4bn to Kc82.6bn in annual terms.

Non-tax and capital revenues and transfers contributed Kc18.8bn to total revenues and tax revenues excluding social insurance contributed Kc7.1bn to the total figure. Transfers from the EU budget were Kc16.6bn higher year-on-year. The amount of money to cover spending on the Common Agricultural Policy rose by Kc9.3bn.

Excise duty collection (including energy and solar tax) stood at Kc21.5bn, a rise of Kc4.9bn from January 2012. Collection of excise duty on tobacco products posted an annual hike of Kc5.2bn. Stocking up on tobacco products over the tax hike as of January 2013 has influenced the tax collection. The tax falls due in 60 days and the effect will mainly be seen in the February figure.

VAT revenues totalled Kc34.6bn, a rise of Kc1.9bn. The January figure still reflects the effect of the growth of the reduced VAT rate in 2012.

VAT revenues increased significantly on an annual basis but this was due to a weak performance in December 2011 rather than high sales in the Christmas period last year, said Sobisek.

A total of Kc36.4bn, a drop of Kc3.3bn in annual terms, was spent on social benefits. Total expenditures grew mainly due to an annual Kc4bn growth in non-investment transfers to social and health insurance funds worth Kc8.4bn.

Czech economic performance in January 2000-2013 (in Kc bn)
year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
surplus/deficit 16.443 18.749 -3.417 -10.391 7.307 3.485 3.427 5.033 9.734 0.482 13.094 10.611 20.997 42.415

Source: Finance Ministry

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