Courtesy of Mish.
Here’s a story you can expect to see in the Wall Street Journal or Financial Times tomorrow. You can read it here today.
Via Google Translate, El Economista reports Spain’s Budget Deficit Grew by 35.4% in January to 1.2% of GDP.
The government deficit in terms of national accounts in January reached 12.729 billion euros, equivalent to 1.2% of GDP, representing an increase of 35.4% over January 2012.
According to the budget execution data published in January by the Ministry of Finance website, the cash deficit in January came to 15,252,000, which are the result of a fall in net income of 37% (5.789 billion) and a expenses increased by 15.4% (21.041 billion).
Tax revenues fell 20% to 10.608 billion, among other causes by the accumulation of returns earlier this year, says Finance.
Negative Indirect Tax Collection
In fact, the state’s revenue from indirect taxes (VAT and special) was negative at EUR 1.647 billion as a result of increased returns, but maintaining the territorial government had total revenues of 1.530 billion, 29.1% less.
The corporate tax revenue has also resulted in negative returns by 1.131 billion. Revenue from direct taxes (income and companies) fell by 18.2% to 9.078 billion.
In the item of expenditure, there was notable increase of 23.3% from the payment of the interest on the debt, which rose from 6.250 billion in January 2012 to 7.709 billion euros in January 2013. There was also a 10.4% increase in payments by current transfers to 9.474 billion.
Within these transfers, Social Security payments grew by 40.2% (2.334 billion), mainly due to the state budget for 2013 makes a greater contribution to the minimum pension supplements.
In the first month of the year, the central government deficit reached 0.89%. The state deficit target for 2013 is 3.8% of GDP, while the target for the total deficit of Public Administration is 4.5% from 6.7% in 2012, as recently reported by the Ministry of Finance.
Spain must cut its budget deficit to 2.8% in 2014, but it is expected that the European Commission extended the deadline for compliance with this commitment.
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