Turkey: The budget has a surplus in March due to the Central Bank's profit

According to the March budget data announced by the Ministry of Treasury and Finance; The budget balance, which gave a surplus of 23.2 billion TRY in February 2021, gave a surplus of 23.8 billion TRY in March 2021. The budget had a deficit of TRY 43.7 billion in the same period last year.

According to the March budget data announced by the Ministry of Treasury and Finance; The budget balance, which gave a surplus of 23.2 billion TRY in February 2021, gave a surplus of 23.8 billion TRY in March 2021. The budget had a deficit of TRY 43.7 billion in the same period last year. As stated in the Monthly Budget Realization Report, the primary deficit, which was 32.4 billion TRY in March 2020, was 38 billion TRY primary surplus in March 2021. Budget revenues increased by 184.4% between March 2020 and March 2021 to reach TRY 134.9 billion, while budget expenditures increased by 21.9% to TRY 111.2 billion in the same period. In the same period, tax revenues increased by 109.5% and reached 77.4 billion TRY. Non-interest budget expenditures increased by 21.4% and reached 96.9 billion TRY. Interest payments expenditures increased by 25.5% in the same period and rose to 14.2 billion TRY. Borrowing costs remained higher than the previous year to reduce inflation.

 

When we look at the 2021 cumulative data; In the January - March period, it was observed that the budget gave a surplus of 22.8 billion TRY. It is observed that the budget, which gave a surplus of TRY 29.6 billion in the 3-month period of the previous year, displays a more favorable outlook compared to the previous year. While 8.7 billion TRY primary surplus was made in January - March 2020, 71.7 billion TRY primary surplus was realized this year. Budget revenues increased by 34.6% between January - March 2020 and January - March 2021 to TRY 344.1 billion, while budget expenditures increased by 12.6% to TRY 321.3 billion in the same period. In the same period, the increase in tax revenues was realized as 44.9% and reached 255.1 billion TRY. Budget expenditures excluding interest increased by 10.3% and reached 272.4 billion TRY.

 

In March, the budget gave a surplus of TRY 23.8 billion with the contribution of the dividend payment received from the 2020 profit of the Central Bank, which was TRY 34.5 billion. In March of last year, there was a deficit of 43.7 billion TRY as this dividend income had no effect. Therefore, it is seen that one-off realizations are effective on budget performance. On the other hand, in the period of March 2020, when the epidemic started and its first serious effects were seen on the tax revenues side, collections contributed to the increase in tax revenues more than twice compared to the previous year, with the base effect created by deferred tax payments and restructuring. As a result of the high rates of change in some items and the decreases in expenditure growth, it can be mentioned that domestic demand limiting measures and public savings also affect the budget performance. Decreasing the incentives provided to the economy and increasing the fiscal discipline in the fight against inflation can make a positive contribution to the budget performance.

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