(MENAFN- Trend News Agency ) The main points in the Ministry of Finance's monthly report on implementation of the state budget and tax revenues show disappointing tax revenues in May and a likely budget deficit. Tax revenues totaled $25.1 billion in May, a figure affected by an exceptional NIS 2.1 billion in tax refunds. An analysis of the composition of revenue shows that revenue fell 4.8% in comparison with last year, Globes reports.
The update published today by the Ministry of Finance show that the cumulative budget deficit is projected to grow substantially starting in August due to exceptional revenues in August-October 2017, the Ministry of Finance says. The cumulative deficit over the past 12 months is 1.9% of GDP, and the target set for 2018 is 2.9% at the end of the year. Outgoing chief economist Yoel Naveh told "Globes" that the deficit would reach the target this year, following a number of years in which it was substantially lower than the target.
The report indicates that tax revenues in May were considerably lower than in May 2017. Assuming uniform tax rates, which means excluding legislative changes, excess collection, deferred refunds, and bringing forth of auto imports in December 2016, revenues were down 5% in real terms in comparison with May 2017. Revenue from direct taxes was down 9% as a result of larger than usual refunds, while revenue from indirect taxes was unchanged.
The report also showed that spending by civilian ministries has grown 5.8% since the beginning of the year, while defense spending was up 1.3%, compared with the corresponding period last year.
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