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Fiscal Council: The budget deficit will reach 3.5% of GDP in 2019

12 March 2019

The latest version of the 2019 budget provides for higher spending by more than 2 billion lei, following the introduction of child allocations to the deficit, according to the Ministry of Finance, standing at 2.76% of GDP. And the Fiscal Council considers that the deficit will exceed 3% of GDP this year, given the projected revenues and expenditures, if public policies do not change, according to

“The increase in the budget deficit target for 2019 and the apparent subdimension of social assistance and contribution payments to the EU budget imply a deficit in the immediate vicinity of the 3% of GDP reference level, even ignoring the problems related to the overstretching of budgetary revenues identified in the context of the opinion of the Fiscal Council of February 5, 2019 (4.5 billion RON, given that the bank asset tax would be maintained in the current form) “, reads the CF document.

“Taking into account this overstretch, we estimate that the budget deficit at the end of this year is likely to reach about 3.5% of GDP, while maintaining unchanged policies.”

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