Govt operating deficit grows as tax take misses target

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The New Zealand government's operating deficit was wider than forecast in the first quarter of the financial year as the Crown took in less tax than expected in a subdued economy.

The operating balance before gains and losses (obegal) was a deficit of $2.1 billion in the three months ended September 30, $449 million, or 27% bigger than forecast.

Core Crown tax revenue was $13.5 billion, or 2.1% lower than expected, the Treasury says.

Source deductions and goods and services tax were $166 million apiece below forecast, reflecting lower-than-expected wage growth and private consumption.

Provisional tax was $103 million below forecast, it says.

Core Crown spending was 1.1% below forecast at $17.3 billion, with under-spending on welfare, education and finance costs. These were offset by higher-than-expected earthquake expenses.

The operating balance, including gains and losses, was a surplus of almost $100 million, or $1.2 billion better than expected, reflecting gains from the NZ Superannuation Fund and the Accident Compensation Corp's investment portfolios.

Gross debt amounted to $79.3 billion, or 38.8% of gross domestic product. Net debt was $54.9 billion, or 26.9% of GDP.

(BusinessDesk)


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Commenter icon key: Subscriber Verified

maybe, just maybe, the Govt spin that" all is well in the engine "will now stop, and they will send some one down to have a look.

The engine room has been blowing smoke for a good year or so, now the ship is slowing down.

Tme for Government to pay attention to the money earners =how do we get the top line up?

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