Revenue shortfall grew 1 bln in May
The increasing revenue shortfalls, growing state debts and exhaustion of the state’s cash reserves illustrate the crumbling of the 2015 budget, and the state in general, over the last few months. The country’s creditors see that economic conditions are deteriorating with every month that goes by, and that is the main reason they are now asking for tougher measures – to offset the budget’s losses to date.
Sources say that May state revenues posted a fresh shortfall of 1 billion euros, even though the payment program for state debtors, allowing them to pay off their dues in up to 100 installments, did bolster the public coffers. At the same time, Finance Ministry data show that the state’s expired debts climbed by 1.1 billion euros in the first four months of the year, while the shortfall in available cash reserves for June alone amounts to 3 billion euros.
In total, the lag in budget revenues in the period from January to May 2015 amounts to about 2 billion euros, of which almost half concerns the shortfall of last month alone. Delays in the submission of taxpayers’ and corporations’ income tax statements have contributed to that problem, but there is also an issue with indirect taxes, given that consumption has declined due to the uncertainty over the last few months.
Official ministry data showed that the primary budget surplus in the first four months of the year amounted to 651 million euros, against 1.6 billion euros in the first four months of 2014. This is mainly attributed to the fact that the social security funds posted a primary deficit of 738 million, against a primary surplus of 438 million euros in the same period last year.
To plug the hole in revenues and cover its obligations to creditors, the SYRIZA-led government has decided to halt payments to other parties. By end-April, the expired debts of the state reached 4.8 billion euros, against 4.4 billion at end-March, including the pending tax rebates.
The main problem in the 1.1-billion-euro rise in state arrears this year to end-April is in the debts of the National Organization for Healthcare Provision (EOPYY) and hospitals, which have expanded by 663 million euros within four months.
