Romania’s budget deficit, down by almost a third in the first five months

Romania ended the first five months of 2021 with a consolidated budget deficit of RON 26.2 billion (EUR 5.34 bln) or 2.29% of this year’s estimated GDP, down from RON 38.8 bln or 3.68% of GDP in the same period of 2020.

Government investments and special expenses related to the pandemic totalled over RON 10.4 bln or 0.91% of GDP in the first five months of this year.

Still, the Government managed to compensate a 9.5% increase in the state’s expenditures with a 23.2% increase in total revenues. “This significant advance is due both to the basic effect of the March-May period last year when fiscal measures were adopted to support taxpayers in the context of the pandemic (mainly extended deadlines for tax payments) and the partial recovery of certain categories of income,” the Finance Ministry explained in a note on the budget execution.

Notably, VAT revenues went up 46.6% year-on-year as consumption recovered.

Romania also received almost 36% more money from the EU in the first five months of this year.

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