Turkey’s January-June budget deficit soars to TL 23 billion

The central administration spent TL 124.83 billion in the January-June period while revenue amounted to TL 101.63 billion in the same period. The primary surplus was down considerably in the first six months of the year compared to the same period last year, falling 82.2 percent from TL 22.7 billion to TL 4.03 billion. Interest payments soared in the January-June period of 2009 compared to the same period of 2008, increasing 31.4 percent from TL 20.74 billion to TL 27.24 billion.

Personnel expenditures climbed 16.2 percent to TL 28.5 billion in the same period. The government projected spending TL 57.21 billion this year on personnel expenditures and used 47.6 percent of this amount in the first half of the year.

TL 3.47 billion was spent on social security premium payments for public workers and civil servants, while TL 10.7 billion went toward public procurement of goods and services.

Current transfers, such as agricultural subsidies and special incentives for certain sectors, totaled TL 46.1 billion in the first half of the year. Capital expenditures were TL 5 billion, and capital transfers were TL 1.18 billion. The state also lent out TL 2.7 billion in the January-June period.

The state spent TL 3.51 billion on healthcare in the first half of the year. The total amount of money spent on healthcare, pensions and social aid rose 46.2 percent over the same period of last year, to TL 25.7 billion.

Agricultural subsidies amounted to TL 3.7 billion in the first six months of the year, while TL 7.94 billion was transferred to local administrations.

Meanwhile, revenue edged down in the first half of the year by 0.9 percent compared to the first six months of 2008, from TL 102.5 billion to TL 101.6 billion. This number falls short of the government's expectations, signaling that year-end targets will be difficult to achieve this year. The government expected to take in TL 248.8 billion in revenue this year, and in the first half of the year, it achieved only 41 percent of this target.

Tax revenue was down 4.4 percent in the January-June period compared to the same period last year, from TL 82.75 billion to TL 79.1 billion.

In this period, income tax revenue edged up by 0.3 percent, value-added tax (KDV) revenue rose by 12.7 percent and banking and insurance transactions tax (BSMV) revenue was up by 20.1 percent. On the other hand, corporate tax revenue was down by 7.6 percent and special consumption tax (ÖTV) revenue dropped by 2.4 percent.

In June, the budget had a deficit of TL 2.5 billion. Expenditures totaled TL 17.93 billion, TL 1.12 billion of which was spent on interest payments. June revenue totaled TL 15.41 billion, TL 12.85 billion of which came from taxes. There was a budget surplus in June 2008.

The primary surplus performance also suffered a sharp fall, from TL 5.12 billion in June 2008 to TL 1.4 billion last month.