As of July, government deficit is RD $13.2 billion or 0.48% of GDP
SD. The financial information released regarding the budget execution for the first seven months of the year, notes that the government closed with a fiscal deficit of RD $13.2 billion.
This deficit represents 0.48% of GDP for 2014, as recalculated in the month of June. In seven months of budgetary execution, this low percentage of the deficit contrasts with the goal put in the Public Budget for all the year, which seems to indicate that the government is on the road towards a reduction of its fiscal gaps at a greater velocity than what was programmed.
Moreover, they reflect that in the month of July the financial resources rose to RD $32.7 billion, which supposes that in spite of the difference between income and expenditures, the government closed this month with a financial availability of RD $18.5 billion.
According to the Director General of the Budget (DIGEPRES), during the January – July period of 2014, the government received financial sources (payment of internal and external loans) for RD $104.6 billion, while its financial applications (debt payments both internal and external) amounted to RD $72.8 billion.
The resulting balance between these two amounts reflects a net indebtedness of the government for RD $31.8 billion, which explains the availability of the resources (the amount not spent) with which this period closed.
Nevertheless, the fiscal deficit measured by the difference between the fiscal income and public expenditures between January and June is less than that reflected in the accounts up until June, which was RD $14.9 billion. Above all if you consider that for the first semester, the information reflected a “residual” or unexplained expenditure for RD $8.3 billion, which raise the deficit to more than RD $22 billion.
According to the Central Bank, the “residual”, comes about when the net financing differs from the difference observed between income and expenditures reported.
Expenditures and income
During the first seven months, the government had only executed 44.7% of the programmed expenditures, while the tax collections reached 49.4%, according to what was published by the DIGEPRES. Those percentages reflect a fiscal contraction in the government, with the greater part on the side of expenditures, but also on the side of income, compared to what was budgeted. Income Taxes, the principal source of fiscal resources, collected 50.8% and Customs collected 49.4% of the goal for the whole year.
Expenditures go slow
In the information published by the DIGEPRES, all the institutions appear in a subsection of budgetary execution. Except, that is, the Ministry of Foreign Relations for which it was reported that it had executed 59.7% of the expenditures assigned. In contrast, institutions such as the Congress and the ministries of education and public health executed 50%, 38.7% and 44.7% respectively. But in educational activities and in public health this expenditure has only been 38.6% and 45.3% according to the functional classification.
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