Greece's budget gap narrows in January-August, but revenues off track

11 SEP, 2012, 05.57PM IST, REUTERS

Economic Times

ATHENS: Greece's budget deficit narrowed by 34 per cent year-on-year between January and August, helped by cuts in public spending and investment, the finance ministry said on Tuesday.

The budget gap fell to 12.4 billion euros ($15.9 billion) from 18.7 billion in the same period last year.

But tax revenues fell short of targets due to the country's severe, austerity-fuelled recession. Despite a tax onslaught, net government revenue rose by just 1.6 per cent to 33.1 billion euros, 2.1 billion euros lower than an interim target set out under the country's international bailout plan.

The data refers to the central government budget deficit, which excludes local authorities and social security spending. The data does not coincide with the general government budget gap, the benchmark for the EU's assessment of Greece's fiscal performance.