February 25 (SeeNews) - Romania's consolidated budget in January showed a deficit equivalent to 0.04% of the gross domestic product (GDP) projected for 2020, compared to a surplus of 0.07% of GDP a year earlier, the finance ministry said on Tuesday.
The deficit is attributed mainly to an increase in VAT refunds by 1 billion lei ($225 million/208 million euro) and a rise in investment expenses by 821 million lei compared to the same period of the previous year, the finance ministry said in a statement.
The consolidated budget deficit totalled 460 million lei at the end of January, as revenue rose 7% year-on-year to 27.55 billion lei, whereas spending increased 11.6% to 28 billion lei.
Labour costs were 8% higher due to wage increases financed from public funds.
Tax revenue rose by 14.4%, social security contributions grew 14.2% and VAT proceeds increased 4% in the review period.
Investments totalled 1.31 billion lei in January, three times higher compared to a year earlier.
The budget for 2020 is based on projections for economic growth of 4.1% and cash deficit equivalent to 3.59% of GDP.
Romania closed 2019 with a consolidated budget deficit of 4.6% of GDP, exceeding the 4.4% ceiling set by the government and EU's 3% threshold.
(1 euro=4.8079 lei)