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Riga, November 29, LETA. Consolidated budgetary revenues in these ten months amounted to 9.07 billion euros, while spending was 8.56 billion euros, the agency reported to the Ministry of Finance (LETA).
The Ministry noted that in the 10 months of 2018, compared to the corresponding period of the previous year, consolidated revenue from the general budget increased by 1.1 billion euros, or 13.9%, while expenses increased by 855.6 million euros, or 11.1%.
Thus, in the consolidated general budget this year, a surplus of 514.7 million euros was generated during the last ten months, an increase of 252.8 million euros compared to the corresponding period of the Previous exercice. The FM explained that the surplus is based on the amount of the state's consolidated budget – 502.4 million euros, the European Commission's repayments for the implementation of the funds of the European Union (EU) being significantly higher than last year, including final payments for the 2007-2013 programming period. 197.4 million euros of investment in cohesion policy.
Total tax revenue from the general budget increased by 8.3% over ten months, as a result of the one-percentage-point increase in the social insurance contribution rate, resulting in 70.1 millions of euros to health financing. Favorable economic conditions have led to an increase in the level of employment – data for the third quarter show that the labor force's share of the overall working-age population has exceeded 70%, while the average remuneration increased by more than 8%, so that social security receipts in the general budget increased by 299.6 million euro or 16.2%.
In contrast, income from personal income tax (income) increased less, by 24.9 million euros or 1.8%, which is influenced by the increase progressive untaxed minimum level of non-taxable differentiated minimum, benefits for dependents and retirees put in place to reduce income inequality.
"The increase in the aforementioned facilities has a negative tax impact on PIT's revenue, although it is largely offset by measures to improve economic growth and tax administration. the largest share of PIT's revenues recorded a 7.2% increase in total revenue over the same period, much more than an increase in IIN's revenues, "the ministry said.
During the last quarter of the year, if it turns out that municipalities are late on revenue from the IRPP, they will be compensated from the portion of the year. 39, IRPP due to central government base budget, as actual tax revenue from local government budgets as well as the special grant would rise to 19.6% of actual revenue from the general budget. , the state budget for 2018. "The completion of the IIN over a ten-month period allows us to predict that IW's fourth quarter revenues will be achieved, a added the ministry.
Economic activity and the increase in the purchasing power of the population, which have contributed to the increase in consumption, to the increase in the price level, have led to a significant increase in revenues from the tax on value added (VAT) and excise duty. In the first ten months of this year, VAT receipts amounted to € 200.5 million, up 11.1% from the previous year, largely due to the to improve management, reduce the underground economy and expand the base. Excise tax revenue increased by 106 million euros, or 14.1%, which was also influenced by the rise in excise goods this year. At the same time, revenue from corporate income tax (GNI) has decreased. They dropped by € 67.8 million, 18.9% less than a year earlier, which was already foreseen and explained by the move to a new PAI system, in which one of the measures most significant in terms of revenue was the removal of down payments from 1 Julia
According to the Minister of Finance, tax revenues were collected in the general budget at the planned level, but differences in tax types are observed. When badyzing the most important tax revenues compared to those planned, the Ministry pointed out the formation of excess excise revenue of 9.9 million euros, or 1.2%, although the difference between the types of goods identified is different. The increase in domestic consumption contributed to the excise tax revenue on alcoholic beverages and the over-execution of the 16.9 million euro beer plan, which were also boosted by the active trade in the Estonian border region.
On the other hand, excise tax revenues on petroleum products were reduced by 4.6 million euros, while tobacco products were reduced by 3.9 million dollars. # 39; euros. Excise tax revenues on petroleum products have been affected by prolonged delays, but non-compliance with the tobacco product plan has been linked to a decrease in total cigarette consumption due to A reduction in smoking and a change in smoking habits as demand for new products on the market increases, leading to a reduction in excise duties. The main income from ordinary activities comes from the UES revenue, which, given the sharp increase in contributions according to the UIN statements for 2017, amounted to 61 million euros, or 26.4% of more than planned.
The tariff revenue, which reached 7.2 million euros in the first ten months of this year, 19.8% more than expected, is a significant over-execution of the plan. FM explained that the increase in imports of iron and steel from third countries represented an increase in incomes, which is directly related to current economic growth rates and the rapid growth of the sector. construction.
Less than expected, revenue from the IRPP, VAT and real estate taxes (GIS) were collected. The tax was not paid for 31.7 million euros, or 2.2%, 28.4 million euros or 1.4% and 10.7 million euros. euros, or 5.3% respectively. Non-compliance with the IIN plan implies lower than expected revenue from dividends paid on cumulative profits in previous years, while non-compliance with the VAT plan is affected by the decrease in the amount of taxable transactions, highlighting the reduction of VAT revenues in October in the wood processing and energy sectors. At the same time, FM added that VAT revenue growth this year was significantly higher than in the years following the crisis. The lower receipts of GNP than expected were determined by the decrease in the cadastral values for the land intended for residential construction, which clogged up the information system of the cadastre – the cultural monument, as well as the discounts granted by the local governments for INR.
This year's non-tax revenue in the state budget in general for a ten-month period is a good plan, while a separate pricing plan has not been completed, noted the Ministry. The non-tax revenue plan is running at 128% this year, with a top-notch business figure of 110 million euros. This overrun was mainly due to a higher amount of dividends paid by AS Latvenergo in the amount of 62.2 million euros for the benefit of the previous year, as well as additional premiums received from 44.2 million euros for public debt refinancing operations.
Similarly, the proceeds from the auctioning of emission allowances allocated to Latvia were higher than expected, ie 18 million euros, or 119.7% more than expected. On the other hand, revenues collected were lower than expected, such as state royalties for state collateral and legal and other services – € 6.4 million, or 9%, of government royalties. for the maintenance of safety reserves for petroleum products – 5.7 million euros or 31 million euros. , 2%, financial stability charges – € 5.6 million or 35.6% and road charges – € 4.9 million or 17.6%.
Expenditure growth was on an equal footing in the consolidated budget of 11.8%, as well as in the local government budget, by 11.3% and, since June, an increase in the growth rate of spending in the general budget was observed, added the ministry. The largest increase in the consolidated budget concerns grants and subsidies, which amounted to 283 million euros, 20% more than the previous year. This evolution has been influenced by increasing investment in public sector institutions and enterprises for the implementation of projects funded by EU funds, as well as an increase in funding in the health sector, including an increase of 47.1 million euros or 33%, resulting from an increase in health care spending 22.2. million, an increase of 18.9% in drug reimbursement expenses. Investment in EU funds, especially at local government level, increased investment expenditure by € 148.9 million, an increase of 22.7% over the previous year. ten months period of the previous year.
In the general budget, expenditure on goods and services recorded a significant increase of € 131.3 million, or 13.1%, mainly due to the rapid growth of the National Armed Forces. In the defense, health and justice sectors, as well as in the tax and local government services, salaries rose by 129.6 million euros, or 7.2% more than During the last ten months.
The increase of 156.8 million euros, or 6.6%, of general budget expenditures devoted to social benefits, was determined by the increase in the average insurance premium. , as well as by indexing pensions, presented to the Ministry. Pension expenditure increased by EUR 95.2 million or 5.9%, while other benefits increased by EUR 61.6 million or 8.4% compared to the previous 10 months.
The Minister of Foreign Affairs also said an increase of EUR 25 million in family allowances and an increase in expenses for sickness benefits of EUR 12.9 million. The increase in the amount of the family allowance was affected by the increase in the number of two and more children introduced on March 1 this year, and the increase in spending was affected by the extension of the number of beneficiaries, increasing the age of children up to 20 years old while they were continuing their studies. The expansion of beneficiaries has increased the number of beneficiaries this year to more than 20,000 people.
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