Blümel: Continuing positive trend - economy now bigger than pre-crisis level Tax income rising - but budget still heavily influenced by the crisis
The Federal Budget figures for the period January 2021 to July 2021 are now available. The report presented by the Federal Ministry of Finance (BMF) to parliament shows, on the one hand, how the Federal Budget continues to be burdened by the COVID-19 pandemic; but on the other hand, positive effects from the upturn in the economy since the opening-up of many sectors in the early summer. As an example, higher tax income has been recorded.
“The continuingly positive trend in the economy is reflected in the budget implementation. According to WIFO, our economic output is now 1.3% above pre-crisis levels. The upturn in the economy is having an effect on tax income. Thus, for example, the improved employment situation is leading to a marked increase in payroll tax receipts. Compared to the same period last year, public tax receipts have increased by 16.7%,” stated Finance Minister Gernot Blümel.
The adjusted incoming payments, at EUR 44.4 billion, amount to some EUR 6.7 bn or 17.8% more than for the same prior-year period. The higher incoming payments result primarily from higher incoming payments in the areas of public taxes (+ EUR 6.0 bn), employment (+ EUR 920.3 m), family and youth (+ EUR 390.7 m), federal assets (+ EUR 382.5 m) and justice (+ EUR 161.4 m).
These are set against adjusted outgoing payments of EUR 58.5 bn, which were EUR 6.9 bn or 13.3% higher than in the comparable prior-year period. The higher adjusted outgoing payments result primarily from higher outgoing payments in the areas: federal assets (+ EUR 4.2 bn), health (+ EUR 1.0 bn), financial equalisation (+ EUR 578.9 m) and the economy (+ EUR 420.6 m).
The monthly budget execution report also contains the most recent COVID-19 report. 292,127 applications and extensions for short-time working were approved up until 15 August 2021. These cover 118,271 businesses and 1,287,992 employees and a funding volume of EUR 10.2 bn. Short-time working payments in total (for 2020 and 2021) up until 15 August 2021 amount to EUR 8.9 bn.
EUR 8.1 bn was paid out of the COVID-19 crisis management fund in 2021 up to and including 15 August. This covers the fixed cost subsidy, lockdown turnover compensation and the hardship fund, amongst other payments. Payment of the turnover loss bonus and loss compensation has been extended until mid-November (turnover loss bonus II) and June 2022 (loss compensation) respectively. In the case of the turnover loss bonus, 436,071 applications from 146,674 businesses have been approved up until 15 August. The subsidies granted amount to EUR 2.9 bn, of which EUR 2,854.9 m has already been paid out. The greater part of this was for turnover loss bonuses for the month of March 2021 (EUR 714.1 m approved and EUR 712.7 m disbursed). In the case of loss compensation, 724 applications have been approved up until 15 August. EUR 297.6 m has already been disbursed. EUR 474.7 m has been paid out to applicants from the NPO support fund up until 31 July 2021 - of this, EUR 234.4 has been disbursed during 2021.
“The opening-up of many sectors in the early summer, combined with the progress made on vaccination, have led to sustained, positive developments in the economy. There are, however, still a few areas - such as city hotels and the night-time gastronomy sectors - that continue to suffer from the effects of the pandemic. Our best means of combating this is the vaccination. I therefore appeal to all who have not yet had the vaccinations to go and get them as soon as possible. Low infection rates not only take the strain off the health system, but help to secure jobs and businesses,” said Blümel.
- Latest data on budget execution (in German)