July 7, 2020

The State doubled its deficit until May and its hole already exceeds that of all administrations in 2019




The State accumulated a deficit until May of 2.88% of GDP, higher than that of all administrations as a whole last year, when Spain closed with a public hole of 2.8%. The statistics published by the Treasury reflect that the public coffers were stressed last month to a critical point in the face of the coronavirus crisis, with the Central Administration and Social Security assuming a large part of the expenses. Thus, the imbalance of the State shot up to 32,251 million euros (2.88% of GDP), double the 15,556 that it had last year (1.25%). The reason for this is that while the collection for the month of May alone fell by 27.6% according to the Tax Agency, State non-financial payments increased 10.8%. From January to May, tax collection decreased 9% and payments increased 14.1%.

The Tax Agency contracted its income by 4,225 million for the measures adopted in the face of the crisis. Tax deferrals to companies that invoiced less than 6 million euros accounted for 2,586 million less, while the suspension of the term to face tax debts reduced revenues by 1,629 million.

Video: EP

Income, in imitation of activity, is losing weight at full speed while spending continues to gain weight, especially due to unemployment benefits and ERTE. When looking at the figures of the Social Security This is where this phenomenon is most accurately auscultated: the exoneration of contributions in the ERTE due to force majeure or to the self-employed have reduced income by 1,247 million, which explains why together they fall 1.57% to 50,185.8 million while benefits soared 8.56% to 59,241.44 million.

In the case of the system, the deterioration is 5,262 million: until May it reached a gap of 2,749 million (0.25% of GDP) compared to 2,513 million surplus last year (0.2%).

When comparing the collection only in the month of May, it is observed that the great sacrifice was the Corporation Tax, which reduced its collection by 54.6%, followed by Special Taxes (-46.1%) VAT (a -29.4%) and personal income tax (-16.1%). In taxes such as Hydrocarbons, in a month in which mobility restrictions were still in force between provinces, the sinking is 62.8%.

Instead, the communities were the only administration that improved their accounts due to state transfers: If last year they had a deficit of 2,714 million (0.22% of GDP), in this they accumulated until April a surplus of 231 million (0.02%). Until May they have received transfers from the Central Government for an amount of 37,088 million, a figure that is 5,967 million more than the previous year, the Ministry of Finance points out.


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