Budget revenues in 2023 reached €2.75 billion, up 7.3% from the previous year

Budget revenues in the past year amounted to €2.75 billion, which is €188.6 million or 7.3% higher than in 2023, according to the Ministry of Finance.

According to the report on preliminary budget cash surplus or deficit levels, public debt and net borrowing, budget revenues in the past year totaled €2.75 billion, equivalent to 36.9% of the gross domestic product (GDP), representing an increase of €188.6 million or 7.3% compared to 2023.

“Excluding one-time revenues, budget revenues in the past year were €333.8 million or 14% higher than in 2023,” the Ministry of Finance clarified.

They highlighted that the most significant positive deviations were recorded in all major categories of budget revenue: corporate income tax, personal income tax, value-added tax (VAT), and excise duties.

“Corporate income tax revenues amounted to €214 million, which is €62.7 million or 41.4% higher than in 2023, and €8.3 million or 4% higher than planned under the budget revision,” the Ministry stated.

Personal income tax revenues reached €88.2 million, reflecting an increase of €21.7 million or 32.7% compared to 2023 and €1.5 million or 1.8% above the revised plan.

The capital budget was executed at €251.17 million, representing 106% of the planned capital budget for the period. Compared to the previous year, its realization increased by €62.15 million or 32.9%.

“Social security contributions amounted to €584.7 million, which is €9 million or 1.6% higher than in 2023,” the report added.

VAT revenues in the past year totaled €1.22 billion, marking an increase of €163.3 million or 15.4% compared to 2023, and €23 million or 1.9% above the revised plan.

Excise duty revenues amounted to €368.6 million, reflecting an increase of €45.5 million or 14.1% compared to 2023, and €2.8 million or 0.8% above the revised plan.

“The most significant contribution to the increase in excise duties came from excise taxes on mineral oils and their derivatives, amounting to €198.4 million, which is €19.3 million or 10.8% higher than the same period in the previous year,” the Ministry of Finance stated.

Revenues from excise taxes on tobacco and tobacco products amounted to €119.2 million, which is €18.9 million or 18.9% higher than the same period in the previous year.

The Ministry of Finance reported an 8.3% increase in cigarette sales, equivalent to approximately 93.8 tons, compared to the previous year. Sales of smokeless tobacco products increased by around 23.6%, or 1.5 million packs, primarily due to efforts to combat market irregularities and the shadow economy in the tobacco sector.

Total budget expenditures in the past year amounted to €2.98 billion, or 40% of the estimated GDP.

Compared to the previous year, expenditures increased by €430.5 million or 16.8%.

“The largest deviations were in pension and disability insurance payments, mainly due to an increase in the minimum pension, institutional transfers, especially to public health institutions, and higher allocations for gross wages due to the adoption of sectoral collective agreements that increased salaries for public sector employees in 2023,” the statement said.

According to the Ministry, compared to the current year’s plan, expenditures were €22.1 million or 0.7% lower, reflecting the timing of financial obligations during the period.

“A budget deficit of €230.9 million was recorded, amounting to 3.1% of the estimated GDP, which is €4.5 million lower than planned,” the statement noted.

A current account surplus of €49.9 million was achieved in the past year. Compared to the plan, which projected a surplus of €34.3 million, this represents an increase of €15.5 million.

“The realization of the current account surplus meets fiscal responsibility criteria, known as the golden fiscal rule, which mandates that current expenditures and transfers should be lower than current revenues and donations. This ensures that the government borrows only to finance capital projects and repay debt,” the Ministry stated.

Total public debt at the end of last year amounted to €4.57 billion, or 61.32% of GDP.

“Taking into account the Ministry of Finance’s deposits (including 38,477 ounces of gold), which stood at €385.36 million at the end of last year, Montenegro’s net public debt as of December 31 was €4.18 billion, or 56.15% of GDP,” the statement read.

The Ministry of Finance emphasized that the continued growth of state budget revenues in the past year, alongside strong economic resilience and macroeconomic stability, was driven by dynamic consumption and investment growth, as well as a noticeable decline in the shadow economy. They highlighted that the Ministry managed public finances and public debt transparently and responsibly.

“The Ministry of Finance remains committed to transparent and responsible management of public finances, as evidenced by the positive trends recorded in the first two months of this year,” the statement concluded.