American Expatriate Costa Rica

Payment of interests represents 56% of the fiscal deficit

Interests continue to rise, becoming the main item that presses the fiscal deficit, since it represents 55.6% of the total. Last November, this item reached 2.8% of the Gross Domestic Product (GDP), equivalent to ¢ 919 billion.

The situation directly affects the fiscal deficit, which went from 4.7% in November 2016 to 5% in November 2017, more than ¢ 1.6 billion.

Income tax stands out for maintaining a growth in two digits (11.5%), rising from 3.7% to 3.9% of the GDP from November 2016 to the same month in 2017. However, this behavior does not prevent the deceleration of tax revenues, which went from an increase of 8.5% in November 2016 to 5.4% in the same period of this year. This percentage is affected by the reduction in the importation of vehicles experienced during the last months and the deceleration of the economy.

The events experienced in this last semester, such as the reprogramming of payments of some obligations, only show a small part of the fiscal problem that our country is going through. While we continue to comply with all the obligations of the Government, not taking prompt decisions to strengthen public finances through the approval of proposed bills in the Legislature, in terms of income and expenditure, will make the economic and social consequences much more difficult to face,”

said Helio Fallas, first vice president and finance minister.

According to the Ministry of Finance, a positive aspect in the figures to November is the dynamism in the capital expenditure. By November 2017, this item registered a variation of 22% and its relation to GDP went from 1.1% to 1.3% in November in one year.

crhoy.com