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State Budget Realisation in 2022

According to preliminary data, the state budget recorded approximately EUR 12.3 billion in revenue in 2022, an increase of just under EUR 1.2 billion, or 10.5%, compared to 2021. Expenditure reached around EUR 13.7 billion, down by EUR 544 million or 3.8% compared to the previous year, while the state budget deficit was just under EUR 1.4 billion.

Last year's budget revenue reached 98.4% of the revenue planned in the rebalanced budget, while expenditure reached 94% of what was planned in the rebalanced budget. The lower-than-planned expenditure, and hence the lower deficit achieved (estimated at around EUR 2 billion in the rebalancing), is mainly due to lower expenditure earmarked for measures related to COVID-19 and the energy crisis, and some lower-than-planned investment spending.

In 2021, the budget deficit was just under EUR 3.1 billion.

Tax revenue inflows reached just under EUR 10.4 billion in 2022, up 12.3% or just over EUR 1.1 billion from the previous year.

Last year, value added tax revenue amounted to over EUR 4.7 billion, 11.7% higher than the year before. This growth is due to the halt in economic activity and consumption during the COVID-19 epidemic and the consequent effect of the release of pent-up consumption last year, as well as inflation.

Income tax receipts rose by 4.3% last year to just under EUR 1.6 billion. The increase compared to 2021 is due to higher employment rates, promotions and the public sector wage agreement, as well as wage growth in the private sector. The absence of higher revenue growth is due to the adoption of the income tax reform which entered into force last April. The implementation of the income tax reform will have a consequent negative impact on income tax revenue in 2023, as higher advance payments will lead to more income tax refunds in the annual assessment in early 2022.

Corporate income tax receipts rose by 38.5% last year compared to 2021 to just over EUR 1.5 billion, the highest on record. The growth reflects a high 2021 increase due to better corporate performance in the year and consequently higher monthly advance payments last year.

Excise duty revenues amounted to just over EUR 1.4 billion last year and were lower by 1.6% than in 2021. The drop in excise duties on energy products is partly due to lower excise duties on motor fuels, which have been reduced to the minimum level set by an EU directive. Excise duties collected on tobacco and alcohol recorded an increase.

Non-tax revenue amounted to EUR 772 million last year, or 5.5% less than the year before, while we received EUR 957 million from the European Union, EUR 10 million more than the year before.

Transfers to individuals and households amounted to just under EUR 2 billion last year, or 22.4% less than the year before. The drop is mainly due to lower social security transfers (higher in 2021 due to measures related to COVID-19) and lower transfers to the unemployed, while family benefits and parental allowances increased at the expense of the childcare allowance.

The state budget spent almost EUR 1.7 billion on investment last year, up 34.8% on the previous year and the highest in history. The largest share of this expenditure, EUR 903 million, was spent on the purchase and construction of fixed assets. Among investment transfers, the most significant is the EUR 262 million we have allocated to municipalities, the bulk of which is earmarked for investment in primary education and kindergartens.

Last year, we spent more than EUR 1.5 billion on the cost of staff in the central administration, or 2.5% less than the year before. This is largely due to lower allowances for work in special conditions and risky situations than during the COVID-19 period.

We paid EUR 655 million in interest last year, EUR 72 million less than the previous year, as a result of record low interest rates on the capital markets.

Subsidies amounted to around EUR 642 million last year, down 21.2% on the previous year, mainly on account of lower expenditure on measures related to COVID-19.

In the Financial Receivables and Investments Statement, EUR 902 million of expenditure was realised in 2022, an increase of EUR 593.6 million compared to 2021. The increase mainly relates to an increase in equity holdings and financial investments in public and state-owned enterprises.