The Portuguese State coffers started the year on positive ground. The Public Administration registered a budgetary surplus of 178,5M€ in the first quarter of the year, 0.4% of GDP, according to INE.
The Portuguese State coffers started the year on positive ground. The Public Administration registered a budgetary surplus of 178,5M€ in the first quarter of the year, 0.4% of GDP, according to the National Institute of Statistics (INE). For the fifth time in the 80 trimesters recorded since 1991, the Portuguese State registers a positive balance on its accounts.
According to INE, expenditure increased by 2.6% between January and March, but revenue compensated with an increase of 6.2% relative to the first quarter of last year. The increase in revenue is explained by increased revenue from taxes and contributions. Revenue from taxes over income and property increased by 6.3%, from production and importation by 4.4% and from social contributions by 5.9%. Between January and March, the State fitted in more 1.163,8M€ in revenue than in the last trimester of 2018 with revenue reaching 40% of GDP.
Raising social benefits and personnel expenses might explain the increase on the side of expenditure. Capital expenditure also registered an expressive increase, partially explained by a slight increase in public investment by 2.9%, reaching 19.9M€.
The increasing expenditure with social benefits and personnel expenses were partially compensated by savings as a result of interest rates dropping by 5.4% (the equivalent to 92.2M€) and the intermediate consumption decreasing by 2.1% (51.3M€). Total expenditure increased by 498.2M€.
The Minister of Finance, Mário Centeno, however, justified the surplus with the economic acceleration, even implying that taxes decreased. For Centeno, “only one factor can explain it: the dynamic economy and labour market in Portugal”.