Primary surplus and revenues exceed target

By Prokopis Hatzinikolaou

Budget revenues in the first five months of the year are showing a rebound according to data released on Thursday by Alternate Finance Minister Christos Staikouras. Notably in May, an election month, revenues posted a significant recovery, exceeding the original targets.

Ministry figures showed that tax revenues in the year to end-May were 146 million euros above target, resulting in a primary budget surplus of 711 million euros for the first five months of 2014.

Staikouras said that the public finances are strengthening, paving the way for a gradual decline in tax rates. “The necessary foundations are being created for the recovery of the real economy and the promotion of employment, the distribution of a social dividend, a reduction in social security contributions and the gradual easing of the tax burdens on corporations and households,” he stated.

According to official data, tax rebates in the first five months amounted to 1.27 billion euros, compared with just 483 million in the same period last year. In May tax rebates were more than double those given out in the same month of 2013 as well as the target for last month. “Tax rebates were particularly high, much higher than in the same period last year,” the alternate minister stated.

Staikouras added that revenues before tax rebates were 250 million euros higher than those of May 2013, while tax revenues were 300 million higher on an annual basis and 285 million above target.

The figures presented are the revised ones, as the budget targets have been updated based on the targets of the midterm fiscal plan agreed with the country’s creditors. Originally the budget had provided for a primary surplus of 1.5 percent of gross domestic product, while...