State Budget registers its first deficit of the year. 1.259M€ until April
The Portuguese state budget registered a 1.259M€ deficit until April this year, but revenue is growing in line with the economy.
The Portuguese state budget registered a 1.259M€ deficit until April this year, which is a notorious 786M€ improvement in comparison to last year’s homologous period. Despite being the first month of the year that registers a deficit, revenue has grown four times more than expenditure.
On March, a surplus of 884M€ was registered, which represents a major achievement of 1.279M€ relative to the same period in 2018. Since the beginning of this year, the Portuguese state budget is presenting positive balances. The ministry of Finance added that the revenue’s growth “follows the economic growth and employment’s pace”.
The Ministry also explains that a set of factors had their impact on this first deficit, but it is believed that they will not impact on the overall national deficit. These are the factors that were pointed out by the Ministry in a press release:
- Extending the 2018 tax payment deadlines had a positive impact of 291M€ on the revenue (more specifically from ISP and Tobacco taxes);
- Paying swap rates in 2018 led to a reduction of 306M€ relative to last year’s homologous period;
- Adopting a new way of paying NHS overdue debts led to an execution of less 249M€ in 2019
The ministry justifies a growing tax revenue of 7.6% with VAT revenue rising by 8.8% and IRS’s by 3.2%, despite the tax burden being relieved this year. Public Investment also grew by 23.2%, which is essentially reflected in the increasing investment of 65% in the Portuguese Railways Company (CP) and of 132% in Lisbon Underground.