Budget is €2.42 bln better off due to property tax, VAT

The Single Property Tax (ENFIA) and value-added tax (VAT) sent budget takings soaring in January-May, according to data the State General Accounting Office published on Monday.

VAT is imposed at very high prices, due to inflation, therefore the state has more receipts than usual from this category, while tens of thousands of property owners have paid their yearly ENFIA dues in a lump sum.

The budget execution data showed the primary result amounted to a deficit of just 1.487 billion euros, against a target for a primary deficit of €3.913 billion, with tax revenues reaching €20.613 billion, €2.843 billion or 16% higher than the target set out in the 2022 budget report. This overshoot is due to the extension of the deadline for payment of road tax until the end of February 2022, the improved performance in the collection of taxes during the current year, as well as in the collection last month of the first ENFIA installment, originally scheduled for September. However, in May there was a small decrease in VAT receipts, which may mean that consumption is beginning to drop in more items besides fuel.

Overall, the analysis of the data for the five months January-May shows VAT revenues amounted to €8.319 billion euros, having beaten their target by €754 million; special consumption tax takings came to €2.607 billion, coming in €132 million below their target; real estate tax revenues amounted to €1.395 billion, having exceeded their target by €829 million thanks to the collection of the first installment of ENFIA earlier than projected; and income tax revenues came to €5.346 billion, topping their target by €550 million.

It is noted that the Independent Authority for Public Revenue has returned taxes of €2.18 billion, €574 million above the target (€1.606 billion).

Budget spending for the period January-May 2022 amounted to €26.352 billion, which was €549 million euros below the target. Payments in the area of ​​investment expenditure came to €3.185 billion, €379 million above the target of €2.8 billion.