Spain: Deficit Falls By 6.2% To November, Stands At 0.88% Of GDP
Spain’s Ministry of the Treasury published the State budget performance data on its website for the month of November, with a deficit that has fallen by 6.2%, equivalent to 0.88% of GDP, in national accounting terms.
The Ministry of the Treasury also released the consolidated deficit of Central Government, the regional governments and the social security system to October, which stood at 1.41% of GDP, excluding financial aid.
The Ministry of the Treasury also published the budget performance data for the local authorities for the third quarter of 2019, which posted a surplus of 2.54 billion euros to September, equivalent to 0.2% of GDP.
State deficit (November)
The State posted at deficit at the end of November that amounts to 0.88% of GDP, or 10.99 billion euros, 6.2% down on the figure posted in the same period of 2018.
State revenue grew to November by 2.6%, while expenses only rose by 2%. Discounting accrued interest, the primary surplus amounted to 0.94% of GDP.
Non-financial State resources
Non-financial State resources increased by 2.6% year-on-year to November, to 186.36 billion euros, equivalent to 14.92% of GDP.
This performance is mainly due to tax revenue, which grew by 1.7% to 157.3 billion euros. Tax on production and imports grew by 3.2% to November, with a noteworthy 3.7% increase in VAT.
Current taxes on income and wealth tax amounted to 66.36 billion euros, a similar figure to that posted in 2018. Corporate income tax was particularly buoyant, growing by 7.6%, due to the upward curve of withholdings on work and growth in revenue from the personal income tax campaign.
Revenue from property increased by 4.9%, from 5.37 billion euros in 2018 to 5.64 billion in 2019.
Non-financial State expenditure
State non-financial expenditure amounted to 197.34 billion euros to the end of November, an increase of 2% on the figure for 2018.
Transfers between public authorities, the largest item of State spending (58.4% of total non-financial expenditure), rose by 2.4%.
Spending on intermediary goods grew by 9%, while employee remuneration increased by 4.5%. Data on wage rises are only comparable as from August; there was a rise of 2.5% in 2019 compared with 1.75% in 2018, and greater spending to draw salaries in line in 2019 compared with the figure posted in the same period of 2018.
Social benefits increased by 10% as a result of a 6.5% increase in expenditure on civil service pensions and of 35% in income tax allowances for maternity and child care, large families and disabled dependents.
There were also increases in assistance for investment and other capital transfers of 9.5%, including 899 million euros not registered in 2018 for the repayment of tax paid on maternity and paternity benefits, and the contribution to the EU based on VAT and GNI, which grew by 5.4% to 9.77 billion euros.
Among the items that decreased, particularly noteworthy was accrued interest, which fell by 4.7%. Subsidies also fell, due to the reduced expense of covering the costs of the electricity system, which was down 14.1% year-on-year.