FISCAL COUNCIL: Serbia's budget deficit of 3,5% GDP

On Friday, August 28, 2015, the Fiscal Council of Serbia, estimated that deficit of the country in 2015 will be app. 3,5% gross domestic product and that in 2016 it could increase if the Government gives up on savings measures including salaries and pensions cuts.

- Budget deficit in 2015 which was planned in the amount of 5,9% GDP could total 3,5% GDP but realistic estimation of its decrease is some 4,5% GDP – the Council stated in monthly report on fiscal trends.

As it was explained, decrease of budget deficit was generated through improvement of payment collection of tax profit ad unusually large payments of public companies and state agencies to budget while expenditures were lower than planned due to lower costs for payment of reimbursements for delays in headcount rationalization and public investments.

It was outlined that next year, budget deficit will be affected by increase of interest rates set aside funds (10 to 15 billion) since during 2015 public debt has significantly increased.

Non-taxable profits, the Council thinks, will most likely decrease by at least 10 billion dinars compared to 2015 since there will be no new payment from EPS of RSD 7,4 billion and some other one-time payments.

Fiskalni savet Republike Srbije

Vlada Republike Srbije

Akcionarsko društvo Elektroprivreda Srbije Beograd

Fiscal council

GDP

state deficit

gross domestic product

Government of Serbia

salary

pensions

fiscal deficit

fiscal consolidation

headcount rationalization in public sector

public sector

lay offs in public sector

fees for public service

EPS

Electric Power Industry of Serbia