The revenues and expenditures of the consolidated budget of Moldova in 2021 and 2022 will be higher than planned, and the receipts of grants will be at least 2 times more than planned - IDIS Viitorul.
This opinion was expressed by the economic expert of the Institute for Development and Social Initiatives Veaceslav Ionita. He believes that the national public budget, after 6 years, during which it did not receive 3-4 billion lei of planned revenues annually, this year, as well as next year, will have revenues and expenditures of at least 2-3 billion lei higher than the planned level, and the grants that will go to the general treasury will be at least twice as much as planned. The expert noted that next year the national public budget envisages an increase in the wage fund by 10%, and the benefits will be gained, first of all, by those with the lowest salaries. In 2022, their salaries will be 20-30% higher, and for other categories of civil servants - by 5-7%. But, according to the expert, due to inflation of 10-11%, state employees will not feel the consequences of the increase in wages. For 2022, the revenues of the national public budget are planned at the level of 80.9 billion lei, and expenditures - 96.2 billion lei. The deficit will amount to 15.3 billion lei, which, according to the expert, would be good to cover at the expense of external resources, since internal sources are expensive due to high interest rates. The economist recalled that absolutely all local budgets are 80% dependent on the state budget. Many mayoralties receive only 20% of their own money, the remaining 80% of the money - from the state budget. The economic analyst said that after 2014, state budgets can no longer be fulfilled as planned, as annual revenues are much lower than expenditures. It was planned to increase revenues through grants, external loans, but due to problems with the "theft of a billion" from banks, partners no longer issued grants or loans, so the authorities had to resort to internal loans. As a result, the government was forced to cut investment spending, Road Fund spending, agricultural subsidies, etc. “In the conditions of Moldova’s international isolation, we did not have external financing, we had to cover the deficit at the expense of internal sources, which led to an increase in budget expenditures with the payment of interest on domestic loans. If last year 1.3 billion lei were required to pay interest on domestic loans, then in 2022 this amount will double - to 2.5 billion lei. Next year, Moldova will have to allocate 6.2 billion lei to pay off debts. It is necessary to direct 2.9 billion lei for interest on internal and external loans and 3.3 billion lei for the return of old loans, ”said the economic analyst. This year, as the expert notes, on the one hand, due to the openness that exists for the new government, on the other hand, due to the unprecedented growth of citizens' expenses, budget revenues will be higher than last year, from VAT and excise taxes by about 6 billion lei. Thus, this year, most likely, the state budget by item of expenditure will be executed in excess of the approved indicator by 2.3 billion lei. Veaceslav Ionita recalled that after 2009, when democratic forces came to power, foreign partners demonstrated unprecedented openness to Moldova, since everyone wanted it to integrate into the EU. “In 2014, out of 6.3 billion lei received by Moldova, 2/3 or 4 billion lei were allocated in the form of grants, which amounted to about 3% of GDP. This result was not achieved either until 2014 or later, when external aid in the form of grants fell to 0.3% of GDP, which is 10 times less than in 2014. Due to international isolation, Moldova missed more than 30 billion lei in the form of grants. This money was supposed to go to the development of infrastructure. Due to the lack of financial resources, the state budget for the last 6 years has been strict, focused on survival, with minimal capital investments, ”the expert said.He also noted that next year the government has a rather modest plan for grants - only 1.3 billion lei. However, according to Veaceslav Ionita, the current government will manage to attract at least 3 billion lei in grants. This will reduce the volume of loans planned for next year. Herewith, in terms of domestic loans, he recommends to be more restrained. Speaking about the Road Fund, where most of the state funds are directed, the economist recalled that foreign partners promised significant investments in the development of road infrastructure in Moldova, but for this the government had to send 80% of excise taxes from the sale of petroleum products to the Road Fund. In 2009, the Road Fund received only 10% of excise taxes, and in 2012, 80% were already transferred. These obligations persisted until 2014, when the bank theft occurred. Subsequently, Moldova was isolated at the international level, and the government, having no money, reduced the resources of the Road Fund. In 2016, instead of 80%, only 30% of excise taxes went to the Road Fund. Thus, after 2014 and until now, the Road Fund was deprived of about 10 billion lei, which should have come from excise taxes in accordance with the law. Next year, according to the economist, the government plans to increase deductions to the Road Fund to 58% of excise taxes, but this is still far from 80%. Veaceslav Ionita also named important elements of the fiscal policy for 2022, stressing that, first of all, it is about the fact that from next year all receipts from road use fees will be transferred to local budgets of the I level. The expert recalled that until 2015 the Road Fund had two sources of income: road tolls, which are paid annually by each driver, depending on engine power, and 80% of the cost of excise tax on gasoline. Since 2015, in order to increase the financial capabilities of local authorities, money from the Road Fund, collected in the form of tax from car owners, went in the amount of 50% to the mayor's office, the remaining 50% to the districts. The annual amount was at the level of 700 million lei. From 2022, the entire amount will go entirely to the mayoralty, and this is more than 850 million lei, money for the maintenance and repair of local roads. “The districts will receive money for roads from the Road Fund. This change is one of the most important changes in favor of mayors over the past 5 years, ”the expert said. The second important element, he said, is the doubling of the personal tax exemption for dependents (children) - from 4.5 thousand to 9 thousand lei. According to the economist, this will significantly reduce the tax burden on families with children. “The more children you have, the less tax burden. I really hope that those who work and have children will feel in the next year that they are paying less taxes, and in fact this is a policy of encouraging families with children. Thus, an average family from Moldova with 3 children will pay 1.4 thousand lei less taxes per year for each worker in the family, father or mother. The budgetary expenditures for this measure of support for families with children amount to 175 million lei annually. Unfortunately, tax breaks do not stimulate the birth of children, but they help those who have children, ”the economist explained. The third important element of the fiscal policy, he called the fact that from 2022, when the contract of sale of real estate is drawn up, the tax on it will be paid by the one who at the beginning of the year was its owner, and the buyer will not be obliged to pay real estate tax for this year. The analyst named the abolition of the luxury tax for mobile communications as another important element. “We have a Fund for Social Support of the Population, which is formed from several sources, and it was recognized that mobile communications are no longer a luxury, and receipts to this fund can be generated from other sources, therefore this tax for mobile operators has been abolished. I think it's good, ” Veaceslav Ionita noted. // 29.11.2021 — InfoMarket
