Business news

Budget records EUR 1.9 billion deficit in first six months

Ljubljana, 31 July (STA) - The Slovenian state budget recorded a EUR 1.92 billion deficit in the first six months of the year, mostly on the account of a considerable drop in revenue related to a lower tax yield as the government introduced restrictive anti-epidemic measures, the Finance Ministry said on Friday.

The EUR 1.92 billion deficit in the January-June period compares to the EUR 219.7 million surplus in the same period last year.

"In addition to a 27.7% growth in expenditure, with costs of wages, goods and services, social and other current transfers increasing the most, also contributing to such a deficit was a 15.5% drop in revenue," the ministry said.

This is mostly on the account of a steep and fast decline in tax revenue related to the restrictive measures introduced to stem the spread of the Covid-19 epidemic, it added.

In the first six months of 2020, state budget revenue amounted to EUR 4.3 billion, which is EUR 788.6 million less year-on-year, while expenditure was up by EUR 1.35 billion to EUR 6.21 billion.

Tax revenue was down by 18.1% year-on-year to EUR 3.54 billion, while non-tax revenue was up by 17.6% or EUR 57.7 million, mostly on the account of additional borrowing, the press release from the ministry notes.

It also notes that expenditure for wages and social security contributions was up 8.6% compared to the first half of 2019 to EUR 735.3 million.

"The increase is largely a consequence of scheduled promotions and implementation of the agreement on wages and other labour costs in the public sector, concluded at the end of 2018."