General government surplus at 1.1% of GDP

Cyprus’ general government recorded a fiscal surplus of €315.1m between January and May 2023 – making up 1.1% of GDP – CySTAT has reported using preliminary data.

At €141.6m and 0.5% of GDP, the surplus recorded in the same period last year was €173.5m lower.

The general government’s total revenues in January-May 2023 were up by 14.1% y-o-y, reaching €4.64b. The increase was mainly attributed to higher taxes on production and imports (up by €210.9m or 13.8% y-o-y and totalling €1.74b), as well as income and wealth taxation. Income and wealth taxes increased by €180.3m (20.5%), reaching €1.05b compared to €879.1m in 2022.

In terms of other revenues, net VAT revenues (after refunds) increased by €153.8m (14.9%), reaching €1.18b from €1.03b in 2022; social contributions were up €182.4m (or 14.8%), reaching €1.41b from €1.23b last year; interest and dividend receipts increased by €2m (4.8%), totalling €43.7m (€41.7m in 2022); and current transfers rose 29% or by €25.2m to reach €112.2m (€87m last year).

In contrast, capital transfers decreased by €22.8m (-59.2%) to €15.7m, from €38.5m in the first five months of 2022. Service revenues also dropped – by €4.0m (or 1.5%) to €260.5m compared with €264.5m in 2022.

As for total expenditures for the period January-May 2023, these increased by 10.2%, totalling €4.33b, mainly due to higher social benefits and personnel compensation.

Social benefits increased by €139.7m (8.7%), reaching €1.75b from €1.61b in 2022; personnel compensation (including social security contributions and pensions for public employees) was up by €127.2m or 10.5%, totalling €1.33b (€1.2b last year); while intermediate consumption increased by €4.3m (1%), amounting to €425.4m compared to €421.1m in 2022. Subsidies increased by €30.6m (96.5%) to €62.3m, from €31.7m in 2022; interest paid rose by €9.6m (5.5%), reaching €185.1m as opposed to €175.5m last year; and the capital account increased by €95.4m (45.8%) and reached €303.5m (€208.1m in 2022).

The only decrease was recorded in current transfers, which were down by €6.3m (-2.3%) to €266.8m as compared to €273.1m in 2022.