230 million euro gap in revenues in the first two months of 2012

Although the budget implementation data presented by Christos Staikouras show primary surplus of 463 million in the first quarter of 2013 – instead of 1.35 billion deficit estimated in the mid-term plan – the deputy finance minister said that the "indirect taxes want close attention" as revenues from these are constantly decreasing.

 

These figures indicate that over-taxation is "torpedoing" state revenues and help the Greek side claiming a reduction of the inefficient taxes.

 

They confirm the dramatic increase in direct tax revenues (+18.7% or 206 million more against January-February goals) and property taxes (+33% or 222 million euros against objectives), the total net proceeds remain in last year levels, however, the overall picture changes dramatically when one calculates the indirect taxes collection from VAT and customs, because of the crisis.

 

If the tax refunds had not been frozen (only 260 million euros from the estimated 490 million) the figures would have unveiled a 230 million shortfall against the target in the first two months. This gap in revenues would have exceeded even half a billion in these two months if the government did not collect an additional 400 million euros from the Bank of Greece as dividends and returns from state bonds.

 

But as more and more people pay old and new taxes, but do not buy and therefore do not pay indirect taxes, the Treasury actually loses money instead of collecting it. For example:

 

-       in the first two months of VAT tax collection was 213 million euros or 8% below target

-       collection of other indirect taxes at 192 million or 33% below target

-       collection from traffic tax at 134 million or 58% below target

-       collection from increased taxes of energy products (fuel, gas, etc.) was 28 million below target or -3.9%

 

And despite the rapid increase in the excise tax on heating oil, the extra revenue from last year was only 80 million euros, due to the dramatic reduction of consumption by 67%.

 

Under these circumstances, the budget deficit was limited to a total of 813 million (plus interest), against a target of 2.63 billion euros in the mid-term program.