Romania‘s Ministry of Finance said on Friday that the country’s consolidated budget was in deficit equivalent to 2.89% of the projected 2021 gross domestic product (GDP) in the first seven months of the year, compared to a gap of 4.71% of GDP in 2020, according to See News.
The government spent approximately RON 9.18 bln (€1.84 bln) on extraordinary payments related to the Covid-19 pandemic in the first seven months of 2021, the finance ministry said in a statement.
“The consolidated budget deficit amounted to RON 49.7 bln at the end of July, as revenue rose 20.6% year-on-year to RON 211 bln while spending increased by 9% to RON 245 bln,” the finance ministry said in a statement.
Tax revenue increased by an annual 15.6% in the January-July period of 2021, social security contributions grew 13% and VAT proceeds jumped by 44%. Excise duty collection was up 19.4% on year, driven by an annual 13.7% increase in tobacco excises and by a 18.2% hike in energy excises.
Investments reached RON 25 bln in the seven months through July, up 24% compared to the same period in the previous year.
During the first seven months of 2021, Romania received RON 14.3 bln from the European Union, an increase of 35.5% compared to the same period last year.
Romania plans a deficit equivalent to 7.16% of GDP and 7% economic growth in the 2021 state budget.
The country closed 2020 with a consolidated budget deficit equivalent to 9.79% of estimated GDP, compared to a 4.6% gap in 2019.