The Finance Ministry is attempting to resuscitate state revenues after their major shortfall in January and the estimate by a top government official that the fiscal gap of the 2015-16 period will amount to between 5 and 7 billion euros.
According to the definitive data on the execution of the state budget published on Wednesday, revenues both from income tax and value-added tax posted a major decline due to the political uncertainty and the inactivity of monitoring mechanisms. The revenue shortfall of more than 1 billion euros has taken the primary surplus to 443 million euros, against a target for 1.366 billion – i.e. 923 million below target.
Net revenues reached 3.49 billion euros, missing their target by 23.1 percent or 1.05 billion. Income tax revenues were off 49 percent while indirect tax revenues missed their target by 13.8 percent. VAT takings produced a 20.4 percent shortfall. Expenditure was 16 million euros within target, at 3.3 billion euros.
The slump in public revenues is the reason why Alternate Finance Minister Nadia Valavani wants to see the new payment schemes for expired debts to the state implemented. The bill containing this provision will be presented to the country’s creditors next week so that it can be tabled in Parliament as soon as possible.