The Ministry of the Economy indicated this afternoon that, In April, a primary deficit of 79,185 million dollars was recorded, while in the first quarter it amounted to 271,920 million dollars, driven mainly by the increase in investments in social assistance and the rise in energy subsidies.
Through a press release, the Treasury Palace indicated that in the fourth month of the year, the total revenue of the National Public Sector (SPN) amounted to 1,085,582 million dollars, which implied a 77.9% year-over-year increase.
During this period, tax revenue increased by 60.3% compared to a year ago, mainly thanks to the increase in revenue associated with social security, which recorded an increase of 71.1% in YOY, Revenues (90.6% YOY), VAT (68.3% YOY) and Debits & Credits (65.0% YOY).
As, Primary spending in April was up 87.4% in April from a year ago, which equates to 92.8% if Covid spending in 2021 and 2022 is excluded.
In the first quarter of the year, a primary deficit of 271,920 million dollars and a financial deficit of 605,906 million pesos accumulate.
“This increase includes capital investments (+85.7% YoY) combined with social inclusion and containment measures (126.4% YoY), in addition to higher energy subsidies , of $96,834 million (148.4% year-on-year, among others) following the increase in international hydrocarbon prices due to the war between Russia and Ukraine”, underlines the Economy portfolio.
Thus, during the first four months of the year, a primary deficit of 271,920 million dollars and a financial deficit of 605,906 million dollars accumulate.
This dynamic is due to the fact that in April there was a real increase in total income of 12.6% in real terms year-on-year, while an expansionary fiscal policy was maintained – it increased by 18, 6% in real terms year-on-year.
In this context, the portfolio led by Martín Guzmán pointed out that Property rents reached $134,799.7 million, implying an increase of $122,990.8 million. He added that of the total of these rents, $102,833.4 million corresponds to real estate rents related to primary emissions, which totaled $222,065.4 million during the first four months of the year.
For the purposes of policy objectives contained in the economic program consistent with a primary deficit target of 2.5% of GDP, the Ministry of Finance has indicated that an annual limit will be established for the calculation of property income related to primary emissions of public securities equivalent to 0.3% of GDP, “which represents an income/GDP ratio of a magnitude equivalent to that recorded for the same concept during the 2021 financial year”.
“Thus, from the month of May, the primary result including this limit will be added to the usual communication of income and expenditure of the national public sector.“, they pointed out.
Social Security benefits amounted to $416,073.8 million (+65.2% year-on-year). “This dynamic is explained by the impact of the current mobility formula, which shows increases as the economy develops and collection and wages recover,” they explained to the Ministry of Economy. .
It must be remembered that andhe Central Bank (BCRA) has turned on the “little machine” print pesos and help the Treasury cover the deficit. For the third time in May, the entity chaired by Miguel Pesce transferred funds to the government, this time 87,615 million COP in concept of temporary advancesFriday the 13th last.
So far in 2022, BCRA’s aid to the Treasury amounts to 376.115 million dollarsequivalent to about USD 3,200 million at the official exchange rate or 0.7% of GDP, while the target for the second quarter is not expected to exceed USD 438,500 million, which limits the scope for the government to receive money from the issuing entity for 58,000 million pesos.
Meanwhile, from the Palacio de Hacienda, they reported that the national public sector recorded a primary deficit of $79,184.8 million in April. “The payment of interest on the public debt, net of intra-public payments, amounted to 67,129.8 million dollars, resulting in a financial deficit of 146,314.6 million dollars”, they detailed.
In the disaggregated analysis, they reported total national public sector revenue was $1,085,581.8 million, representing a 77.9% year-over-year increase. While tax revenues increased to $903,592 million (+60.3% year-on-year), driven mainly by the dynamics of taxes related to Social Security and economic activity.
Likewise, the Ministry of Economy affirmed in the press release that the Contributions and Contributions to Social Security increased by $123,959.7 million (+71.1% over one year) under the effect of the increase in the average salary after the various joint agreements and the resumption of the registered employment. He said taxes such as revenue were up $43,646.6 million or 90.6% year over year, VAT net of refunds (+$77,900.5 million; + 68.3% YoY) and Debits & Credits (+$36,479.6m; +65.0% YoY) contributed to tax revenue growth.
Foreign trade taxes show a growth of +24.2% YoY, where import duties recorded an increase of +59.4% YoY, driven by growth in economic activity, while that export duties increased by +14.0% year-on-year, affected by the progress of the registration of operations between February and March, and by the stoppage of the transport of goods and the labor dispute in the ports that have affected the normal activity of the agricultural export sector.
Taxes such as income (growth of $43,646.6m or 90.6% YoY, VAT net of refunds (+$77,900.5m; +68.3% YoY) and debits and credits (+$36,479.6 million; +65.0% ai) contributed to tax revenue growth.
In another order, the Palacio de Hacienda reported that current transfers reached $447,590.0 million (+124.4% year-on-year).
“Those corresponding to the private sector showed growth of +194,539.1 million dollars (+126.5% year-on-year). The increase in the Empower Work program stands out (+$33,229.6 million) due to the inclusion of new beneficiaries and the increase in the Living and Mobile Minimum Wage (SMVyM), which reached $38,940 in month of April; the growth of food policies (+ $8,800.0 million) following the national government’s initiative to expand the universe of beneficiaries up to and including 14 years of age in the month of May 2021“, he said.
As well as “the extraordinary increase granted to retirees and/or pensioners, and the increase in the payment of family allowances (+25,434.0 million dollars), which provides for the granting of the monthly supplement”.
At the same time, the Economy reported that increases were observed in transfers intended for programs TO ACCOMPANY with an increase of $3,118.9 million, Progresar (+$3,024.5 million), Medical care for beneficiaries of ANDIS non-contributory pensions (+$2,868.5 million) and Assistance to agents of health insurance (+$2,848.8 million).
In energy subsidies, transfers to Cammesa (+53,784.1 million dollars) increased mainly due to the increase in international hydrocarbon prices due to the war between Russia and Ukraine.
Ultimately, social security benefits amounted to $416,073.8 million (+65.2% year-on-year). “This dynamic is explained by the impact of the current mobility formula, which increases as the economy develops and incomes and wages recover”, they explained.