The budget surplus reached RON 397.1 million (EUR 87.2 million) in the first two months of the year, namely 0.05% of the GDP.

By comparison, the budget surplus amounted to 0.10% of the GDP at the end of February last year, according to the Finance Ministry.

The budget revenues totaled RON 34.9 billion (EUR 7.74 billion) in January and February, down 1.4% compared to the same period last year.

The revenues from the VAT collection dropped by 15.8% year-on-year. The drop is due to the reduction of the VAT rate from 24% to 20% starting January 1, 2016. The VAT rate further went down to 19% at the beginning of this year.

However, the revenues from the income tax went up by 13.6% year-on-year, and the revenues from social contributions rose by 11.9% year-on-year. The capital revenues increased by 76.8% year-on-year. Meanwhile, the revenues from excise duties dropped by 5.3% in January-February compared to the same period last year.

The state’s expenses totaled RON 34.5 billion (EUR 7.65 billion), down 0.3% year-on-year. The staff costs rose by 13.3% year-on-year, due to the salary increases in the public sector that took place in the second part of 2016.

editor@romania-insider.com