Romania Drafts 2020 Budget on 3.59% Deficit, 4.1% GDP Growth

Romania's 2020 state budget will be based on a gross domestic product of RON1.129 trillion, a projected economic growth of 4.1% and a deficit of 3.59% of GDP, finance ministry data showed Tuesday.

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The government sees average inflation at 3.1% in 2020 and the current account gap at EUR10.6 billion, or 4.5% of GDP.

The draft budget sees revenues at RON360 billion, or 31.89% of GDP, and estimates spending at RON400.69 billion, or 35.48%of GDP.

Investment spending is set to grow to RON50.7 billion in 2020 compared with RON44.4 billion in 2019.

Staff spending is set to grow 6.6% compared with 2019, to RON109.2 billion, while social assistance spending is set to grow 14.5%, to RON131.2 billion in 2020 due to a planned increase in pensions.

On the revenue side, the government expects 10% growth in value-added tax collections, 14% growth in income tax collections, 9% growth from profit tax and 8% growth from excise duties. Revenues are set to increase by 10% overall compared with 2019.

Prime minister Ludovic Orban said the government is likely to seek a confidence vote to have the budget bill adopted by the end of the year, bypassing the lengthier regular parliamentary procedure.

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