Hungarian Government Deficit 6.3% of GDP in H1 2023

According to preliminary data, the deficit of the general government sector in the 1st half of 2023 was HUF 2,296 billion, 6.3% of GDP. The deficit of the 2nd quarter was HUF 570 billion, 3.1% of GDP, the Central Statistical Office (KSH) reports.

In the 1st half of 2023:
The general government sector’s revenues were HUF 15,366 billion and its expenditures HUF 17,662 billion.

In the 1st half of 2023, compared to the same period of 2022:
Revenues went up by HUF 1,605 billion or by 11.7%. The largest, HUF 790 billion (13.9%) increase in value was recorded in taxes on production, within it, VAT revenues grew by HUF 172 billion (by 5.5%), besides, special taxes rose significantly as well. Revenues from taxes on income surpassed by HUF 365 billion (16.1%) the previous year’s level. Social contributions increased by HUF 462 billion (by 14.6%). Other revenues decreased by HUF 11 billion (by 0.4%).

Expenditures increased by HUF 3.232 billion or by 22.4%. The growth in case of paid compensation of employees was HUF 33 billion (1.0%), being impacted by the payment of the six-month ‘firearms money’ in the base period as well. Social benefits other than social transfers in kind increased by HUF 778 billion (23.1%), owing mainly to increased amounts of paid out pension benefits. Intermediate consumption went up by HUF 370 billion (by 15.1%) and interest expenditures rose by HUF 832 billion (by 2.1 times). Gross fixed capital formation decreased by HUF 210 billion (by 15.3%). Other general government sector expenditures went up by HUF 1429 billion (by 47.5%) year-on-year, mainly due to a sharp increase in subsidies for energy supplier companies.

The balance deteriorated by HUF 1,627 billion, or by 4.2 percentage points as a proportion of GDP compared to the same period of the previous year.

In the 2nd quarter of 2023, compared to the same period of 2022:
Revenues increased by HUF 1,121 billion, by 16.0%.

Expenditures were HUF 1,429 billion (19.6%) higher.

The balance deteriorated by HUF 308 billion or by 1.5 percentage points compared to the previous year.