November, tax revenues fall for the first time in 4 years, businesses are making less

2025-01-08 09:16:00, Ekonomi CNA

November, tax revenues fall for the first time in 4 years, businesses are making

The collection of budget revenues had a positive trend throughout 2024. In the entire 11-month period of 2024, revenues from taxes and customs increased by 10.3% more than in the same period of 2023, but in November the receipts took a negative turn where tax revenues recorded an annual decrease of -1.5%.

This is the first time that tax revenues are decreasing on an annual basis, since January 2021, when the country was still suffering the consequences of the pandemic.

In total, budget revenues increased by 2.7 percent in November, but the gap created by the drop in tax and tax collections was covered by aid revenues (loans and foreign donations destined for the state budget).

More detailed data from the Ministry of Finance's fiscal indicators show that the decline was caused by weaknesses in income from income tax and local taxes. In November 2024 income from Income Tax was almost 55% lower than a year ago. In November, 4.1 billion ALL were collected in this item from 9.1 billion in November 2023.

The lower Income Tax revenue comes as a result of the end of the extraordinary tax effect on the profits of energy producers. This measure has been present with its impact throughout the year 2024, but in November budget revenues have been negatively affected by lower revenues from customs duties and local taxes.

Income tax has also been negatively affected by the negative performance in the manufacturing sector. The exchange rate has ruined the profits of export industry businesses, also affecting budget revenues.

In November, revenues from local taxes were 43% lower than in 11 months of 2023. During January-November 2024, 2.4 billion ALL were collected from this tax, while in the same period of 2023, 3.6 billion ALL.

The taxes that have performed better in November are those on salaries (TAP and income on social and health insurance) that had an annual increase of over 14%

Also, public expenditures in November were 14.8 percent lower than November 2024.

Capital expenditures in November 2024 were 6.7 billion ALL or 64.5% lower than a year ago. Also, debt interest expenses were 22.8% lower than November 2023 as a result of the stabilization of interest rates in the international and domestic market after the increase created by the war in Ukraine during 2022 and 2023./ CNA