The cumulative deficit of the government in August decreased by 1.2% to a level of 8% of the GDP

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by Ifi Reporter Category:Capital Market Sep 13, 2021

The huge improvement in the state budget data continues, along with increased activity in the economy - which has been open for seven months since the third closure. Although the state budget in August was again in deficit, the deficit is shrinking from month to month. In August, the deficit amounted to only NI 1.2%S 1.1 billion. The decrease in the cumulative deficit in August alone is the largest in all the 2000s - a decrease of to a level of 8%. In June, the budget deficit was 10% and in July 9.2%.

Senior officials in the Ministry of Finance explained in the briefing on the budget data that the decline is due to the economy remaining open without closures, with a significant increase in tax collection along with a decrease in government spending, including a reduction in unemployment benefits and grants.
The cumulative deficit in the last 12 months amounts to NIS 45.5 billion, compared with NIS 88.6 billion in the corresponding period last year.
The cumulative rate of increase in expenditure - excluding the economic assistance program for Corona - from the beginning of the year to August 2021 amounts to 5.5%, compared with the corresponding period in 2020.
The rate of cumulative growth in state revenues in the first eight months of the year, compared to the same period in 2020, is particularly large - 23.7%.
Implementation of the economic assistance program due to the Corona virus crisis from the multi-year plan for the years 2020 and 2021 stands at NIS 162.3 billion.
Total government expenditure in August was only NIS 34.5 billion and since the beginning of the year, expenditure amounted to NIS 310.3 billion, compared with NIS 294.0 billion in the corresponding period in 2020. This is a fairly significant increase of 5.5% over the same period last year. Excluding expenditure on the economic program for Corona, the increase is only 3.5%.
The multi-year financial assistance program to deal with the corona crisis stands at NIS 188 billion. The cumulative implementation of the plan, including special assistance that was not planned in advance for the health system and was given last month, stands at NIS 162.3 billion, about 86% implementation compared to the planning for the entire year.
Total state revenues amounted to NIS 33.4 billion in August, and since the beginning of the year revenues have amounted to NIS 264.9 billion, compared with only NIS 205.5 billion in the corresponding period in 2020.
The increase in all state revenues amounts to 28.9%, while state revenues only from taxes increased by 23.7%. This is also surprisingly an increase of about 15% compared to revenues in the corresponding period in 2019, even before the corona crisis, so the data indicate the intensity of the economy's recovery.
A spokesman for the Tax Authority said that in August 2021 imports were recorded in the amount of 24,640 vehicles (private) compared to 18,225 in August 2020, an increase of 35.2%. Commercial vehicle imports also continue to rise, amounting to 1,186 vehicles compared to 645 in August 2020, an increase of 83.9%. The increase in passenger car imports is due to relatively high imports in August 2021 and low imports in August 2020. It should be noted that the mix of imported vehicles is gradually changing. The number of hybrid and electric vehicles is growing, as is their share of total vehicle imports, rising from 18% and 11% in August 2020 and 2019, respectively, to 33% in August 2021.
In January-August 2021, imports of passenger vehicles amounted to 175,441 compared to 120,548 in the corresponding period last year, an increase of 45.5%. Imports of commercial vehicles increased by an even more significant percentage by 70.7% and reached a volume of 8,053. The high increase in commercial vehicle imports is partly explained by an increase in demand for commuter vehicles.
The trend data indicate a stabilization in the import of passenger vehicles in June-August 2021 after an increase that began in July 2020.
In total, in January-August 2021, imports of refrigerators and dishwashers increased by 32.1% and 15.6%, respectively. Imports of washing machines and dryers, on the other hand, decreased by 4.1% and 1.8% compared to January-August 2020. Imports of televisions decreased by 34.0% in August 2021 compared to August 2020. Cumulative imports of televisions have decreased by 5.3% since the beginning of the year.
In August 2021, there was an increase in the import of cigarettes by 14.3%, compared to August 2020. Revenue from the purchase tax on the import of cigarettes increased by a similar rate. The value of other tobacco imports, including smoking tobacco, hookah tobacco, pipe tobacco, cigars and heating units, increased in August 2021 by 22.3% compared to August 2020. In total since the beginning of the year, other tobacco imports increased by 20.1% and purchase tax revenues A more moderate 9.8%.
The total value of total imports in August 2021 amounted to $ 7.9 billion, an increase of 43.3% compared to the value of imports in August 2020. The increase is partly due to relatively high imports of vehicles in August 2021 and low imports of vehicles in August 2020.

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