Ašeradens noted that the situation with VAT revenue is not good, however, labor taxes are doing better.
“At least in my understanding, the first quarter is better than originally looked,” Ašeradens said, noting that labor tax revenues lag by 35.6 million from the planned ones, which is just over 1%. “We are lagging behind, but the situation is not critical,” the Finance Minister said.
Ašeradens said the Ministry of Finance will release a report on the next four years' budget income forecasts on Friday, April 26, while on April 30 the government will view the Ministry's financial stability report to submit to the European Commission.
When asked whether budget deficits are expected to increase further over the course of the year, Ašeradens replied that the economic environment is currently very fluid and it is not known how the security situation in Ukraine and the Middle East will develop.
Ašeradens pointed to the good news from the European Central Bank, which may start reducing interest rates in June, but at the same time there is no good news about other countries' economies, including significant cuts in their spending by Estonian and Finnish governments. Asheraden said he strongly advises the government against taking on new costs because it is important to finish this year with a 2.9% deficit.
“If we exceed the 3% deficit, then all the next four years will have to cut government costs,” the minister noted.
