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Government’s deficit down to 1.1% of GDP

30/11/2021 16:27

General Government deficit decreased by €458.4 million in the first ten months of 2021, reaching €261.9 million compared to a deficit of €720.3 million in the same period of 2020. The reduction is attributed to the increased state revenues from taxes and social contributions.

The preliminary General Government fiscal results, which are prepared by the Statistical Service of Cyprus (CyStat) indicate a deficit of €261.9 mn (1.1% of GDP) for the period of January-October 2021, as compared to a deficit of €720.3 mn (3.3% of GDP) that was recorded during the period of  January-October 2020.

During the period of January-October 2021, total expenditure increased by €646.3 mn (+ 8.7%) and amounted to €8,040.8 mn, compared to €7,394.5 mn in the corresponding period of 2020. It is noted, that the increase in specific expenditure categories is due to the support measures taken to address the effects of the Covid-19 pandemic. Specifically, social benefits increased by €313.1 mn (+ 11.4%) and amounted to €3,052.9 mn, compared to €2,739.8 mn in 2020.

Compensation of employees, including imputed social contributions and pensions of civil servants, increased by €101.0 mn (+ 4.6%) and amounted to €2,311.3 mn, compared to €2,210.3 mn in 2020. Subsidies increased by €48.0 mn (+ 9.4%) and amounted to €557.0 mn, compared to €509.0 mn in 2020. The increase in the specific category is mainly attributed to additional support measures to enterprises due to the continuance of the Covid-19 pandemic. Current transfers increased by €69.2 mn (+ 16.5%) and amounted to €488.6 mn, compared to €419.4 mn in 2020.
 
Intermediate consumption increased by €76.1 mn (+ 11.5%) ) and amounted to €740.2 mn, compared to €664.1 mn in 2020. Interest payable increased by €46.3 mn (+ 12.2%) and amounted to €424.6 mn, compared to €378,3 mn in 2020. The capital account decreased by €7.5 mn (-1.6%) to €466.2 mn, from €473.7 mn in 2020. In detail, gross capital formation increased by €11.2 mn (+3, 1%) and amounted to €372.0 mn, compared to €360.9 mn in 2020 and other capital expenditure decreased by €18.6 mn (-16.5%) to €94.2 mn, from €112, 8 mn in 2020.

During the period of January-October 2021, total revenue increased by €1,104.7 mn (+ 16.6%) and amounted to €7,778.9 mn, compared to € 6,674.2 mn in the corresponding period 2020. In detail, taxes on production and imports increased by €383.8 mn (+ 15.9%) and amounted to €2,802.4, compared to €2,418.6 mn in 2020, of which net VAT revenue increased by €291.7 mn (+ 19.1%) and amounted to €1,821.5 mn, compared to €1,529.8 mn in 2020.
 
Revenue from taxes on income and wealth increased by €197.6 mn (+ 12.8%) and amounted to €1,741.3 mn, compared to €1,543.7 mn in 2020. Social contributions increased by €267.2 mn (+ 14.0%) and amounted to €2,172.5 mn, compared to €1,905.3 mn in 2020. Capital transfers increased by €198.8 mn and amounted to €267.9 mn, compared to €69.1 mn in 2020. Current transfers increased by €12.6 mn (+ 7.8%) and amounted to €174.8 mn, compared to €162.2 mn in 2020.
 
Revenue from the sale of goods and services increased by €30.2 mn (+ 6.3%) and amounted to €512.6 mn, compared to €482.5 mn in 2020. Property income increased by €14.6 mn (+ 15.7%) and amounted to €107.4 mn, compared to €92.8 mn in 2020.