Image: VOLKER WEIHBOLD
The debt ratio – i.e. the ratio of national debt to economic output – increased from 78.4 to 78.6 percent in the same period, and the public deficit rose from 6.3 to 9.6 billion euros, or 4.1 percent of the total Economic performance, it said in a press release on Friday.
“Political measures to cushion high energy prices and the inflation adjustment of pensions have caused government spending to rise significantly in the first two quarters of 2023,” said Statistics Austria Director General Tobias Thomas: “At the same time, government revenue has grown significantly less dynamically than recently.”
In the first half of 2023, the state’s financing deficit was 9.6 billion euros. The federal sector’s deficit of 8.1 billion euros was primarily responsible for this, but that of the municipal sector of 2.0 billion euros also contributed significantly to the negative national financing balance, according to Statistics Austria.
Measured in terms of gross domestic product (GDP) at current prices, the public deficit was 4.1 percent. Compared to the first half of 2022 (deficit of 6.3 billion euros or 2.9 percent of GDP), this is an increase of 3.3 billion euros. Compared to the first half of 2022, government revenue increased by 5.5 percent or 5.9 billion euros, and government spending increased by 8.2 percent or 9.3 billion euros.
Tax revenue increased slightly
86.4 percent of government revenue in the first half of 2023 comes from taxes and social contributions, which total 97.2 billion euros. This is an increase of 5.4 percent or 4.9 billion euros compared to the previous year. Tax revenue increased by a total of 4.1 percent in the first half of 2023 compared to the previous year, but the increase was significantly lower than in previous years.
Due to the persistently high inflation, goods taxes (+8.0 percent) were the main drivers of the state’s revenue growth; income taxes remained at the previous year’s level – also due to the abolition of cold progression starting in 2023. In comparison, social contributions developed significantly more dynamically at +7.6 percent. Investment income (2.8 billion euros in the first half of 2023 versus 1.6 billion in the first half of 2022), and especially the dividend distributions to the state, also increased state revenue.
According to Statistics Austria, the recent increase in government spending is primarily due to the strong increase in monetary social benefits (+3.5 billion euros, mainly due to the increase in pensions) and the increase in the compensation of state employees (+1.8 billion euros). In addition, the state’s subsidies increased again more sharply in the first half of 2023 compared to the same period in the previous year, especially expenditure for the electricity price cap and the energy cost subsidy 2 for companies.
Increase in debt
The debt level as of June 30, 2023 was 366.0 billion euros, which is 15.3 billion euros more than at the end of 2022. Broken down by type of debt, the debt level on June 30, 2023 was 322.0 billion euros Bonds, 42.1 billion euros on loans and 1.9 billion euros on deposits.
As in previous periods, the largest share of the increase in public debt was attributable to the federal sector at EUR 13.8 billion. The increases in debt in the federal sector were increased by a further 1.5 billion euros by the other sub-sectors, particularly through short-term borrowing of liabilities in the social security sector during the year.
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