ECONOMY

Budget target to be ‘close to’ 3 percent

The government planning to trim the 2015 primary surplus target of 3 percent only marginally, a Finance Ministry official said on Friday, refuting reports of a budget target of 2.3 percent of gross domestic product, while the latest data regarding this year’s budget suggest the 1.5 percent target might be exceeded.

“What’s being reported in the media, that the primary surplus target will be much lower than 3 percent, is not true,” the ministry official said, responding to reports of a bigger cut to accommodate tax relief measures ahead of the tabling of the draft 2015 budget on Monday. He explained that the target will be “close to” 3 percent.

Meanwhile the publication of data concerning the execution of the budget for the first eight months of this year confirmed that the difference between revenues and expenditure not including interest payment will be above target, Alternate Finance Minister Christos Staikouras stated on Friday.

The State General Accounting Office on Friday issued figures on the execution of the budget up to end-August, which showed a primary surplus of 2.5 billion euros or 1.3 percent of GDP, against 1.2 billion or 0.6 percent in the first eight months of 2013.

“These figures confirm that, with the sacrifices made by households and corporations, we are very close to achieving or even exceeding the target for the general government’s primary surplus by the end of the year, as will also be reflected in the draft budget for 2015,” read the statement issued by Staikouras.

Sources say that the ministry expects the primary surplus to amount to 1.7 percent of GDP at the end of the year, while Staikouras noted in his statement yesterday that “the government is methodically and systematically creating expanded degrees of liberty so as to gradually proceed with the overall reduction in taxation and with the exercise of social policy.”

The good course of the budget is based on the containment of expenditure, while the surpluses of local authorities and social security funds were reduced in the year to end-August, compared with the same period in 2013.

In January-August 2014 expired debts owed by the state, including outstanding tax rebates, amounted to 4.67 billion euros, from 4.65 billion at end-July.