Despite spending cuts, due to falling revenues and rising interest rates, during the first quarter of this year the national administration’s financial deficit was 7.4% higher. in real terms to that of the first three months of 2022.
“Excluding debt interest payments, the primary result was a negative $758,991 million, 3.3 percent less in real terms than the deficit it reached a year ago,” the National Congressional Budget Office report reads. .
The report details it total income was $4,447,917 million and contracted 9.5% in real terms compared to the same period of the previous year.
This reduction is mainly explained by the 16.2% year-on-year decline in tax revenuesessentially due to the lower collection of taxes related to foreign trade, affected by drought and import restrictions, which was partially offset by the increase in Social Security resources, which showed an expansion of 3.2% y/y
Export duties decreased by 69.5% and import duties by 19.6%, while the increase in economic activity favored the collection of VAT (+4.3%) and the tax on checks. Social security contributions and contributions also increased (3.2% y/y), favored by the greater number of formal jobs.
For his part, Total expenses were $5,902,586 million and decreased 5.9% in real terms, adjustment that reached 8.7% of primary expenditure, mainly driven by lower energy subsidies (-27.4%) and capital transfers to housing trust funds.
The Report highlights that “regarding energy subsidies ($448,235 million), a decline of 27.4% YoY in real terms was observed. representing a reduction of 58.2% on an annual basis”. And he adds “that in the period under analysis the seasonal prices paid by users increased above the generation costs (143.3% vs. 84.0% year on year)
“Against an environment of reduced expenses, interest payments increased by 22.0% year over year,” says the report.
Furthermore, “costs for personnel (8.2%) and transport subsidies (21.8%) have grown. Within social benefits, retirement and pensions decreased by 1.1% and family allowances decreased by 30.0%, while non-contributory pensions increased by 8.4% and social programs recorded an increase of 4.6%.
In short, the primary result was negative at $758,991 million, 3.3% less than the deficit achieved a year ago. Adding interest payments, the total deficit was $1,454,669 million, 7.4 percent higher in real terms than in the same period in 2022.
NS
Source: Clarin
