Cyprus budget deficit leaps to 6.1% of GDP in 2009

Official figures confirm that the budget deficit ballooned in 2009, reaching EUR 1,028.7 mln, or 6.1% of GDP, from less than 1% of GDP in 2008.
Expenditure in 2009 increased by 5.5% while revenues dropped by 10.2%.

In the fourth quarter alone, total revenue fell by 15% to EUR 1,772.0 mln, while total expenditure decreased by 2.8% to EUR 2,346.1 mln.
The deficit in the fourth quarter was EUR 574.1 mln, compared with EUR 325.9 mln in the corresponding period of the previous year.
Taxes on production and imports in the fourth quarter dropped by 29.7% to EUR 534.0 mln. Within this category, VAT fell by 22.7% to EUR 387.0 mln
Taxes on income and wealth dropped by 20.4% to EUR 530.5 mln.
Revenue from sales of goods and services fell by 31.4% compared with the corresponding period of the previous year.

Wage bill up 12.4%
On the expenditure side, compensation of employees in the fourth quarter rose by 12.4% to EUR 803.5 mln and social transfers by 9.2% to EUR 689.5 mln.
Current transfers fell by 81.3% to EUR 49.3 mln.
There was a big increase in capital investment (38%), while intermediate consumption decreased by 7%.