Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


NZ govt operating deficit bigger than expected as tax take l

NZ govt operating deficit bigger than expected as tax take lags

By Paul McBeth

Jul. 8 (BusinessDesk) - The New Zealand government posted a bigger operating deficit than forecasts in the May Budget, as company tax and GST again lagged expectations.

The Crown's operating balance before gains and losses (obegal) was a deficit of $1.1 billion in the 11 months ended May 31, smaller than the $3.27 billion shortfall a year earlier, though more than the $767 million deficit forecast in the Budget economist and fiscal update. Core tax revenue was up 4.6 percent from a year earlier, though $459 million short of expectations at $56.5 billion, with goods and services tax was lower than forecast on more subdued domestic consumption. The company tax take was below forecast due to some large downward adjustments in end of financial year assessments.

"It is too early to determine the likely impact of these results on the current and future financial years as both downside and upside risks exist," acting chief government accountant Fergus Welsh said in a statement. The Treasury will update its forecasts in the pre-election economic and fiscal update on Aug 19.

In May, Finance Minister Bill English confirmed a return to Budget surplus in the 2015 fiscal year at $372 million, wider than the $86 million projected in the half year economic and fiscal update, with bigger surpluses projected after that as an accelerating economy helps bolster the government's books.

The accounts show Crown expenses were $36 million below forecast at $64.17 billion at the end of May, with underspending across a number of departments, the biggest of which was at the Ministry of Business, Innovation and Employment. Core spending was up from $63.74 billion a year earlier.

The residual cash deficit narrowed to $3.83 billion from $5.58 billion for the same 11 month period in 2013, though was $398 million below forecast due to the lagging tax take.

Net debt was $453 million ahead of forecast at $59.47 billion, or 26.2 percent of gross domestic product, while gross debt was below forecast at $82.15 billion, or 36.3 percent of GDP.

The operating balance, which includes movements in the Crown's investment portfolio, was a surplus of $4.33 billion, $165 million below forecast, and smaller than the $6.48 billion surplus at the same stage of the previous fiscal year. Gains in the value of its equity investments were offset by an increase in the Accident Compensation Corp's insurance liability.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Statistics: Dairy And Travel Still Our Largest Export Earners

New Zealand earned $2.3 billion more from exports than we spent on imports during the year ended June 2015... total exports of goods and services were $67.5 billion, while total imports were $65.1 billion. More>>

ALSO:

Approval: Air New Zealand And Air China Launch New Alliance Route

Air New Zealand and Air China have today launched joint sales for a new daily direct service between Auckland and Beijing after receiving approval from New Zealand Minister of Transport Hon Simon Bridges to form a strategic alliance. More>>

ALSO:

Money Trading: FX Trader Jin Yuan Finance Warned Over Lack Of Monitoring

Jin Yuan Finance, an Auckland-based foreign exchange trader, has been warned over its lack of anti-money laundering processes in place in the first public notification by the Department of Internal Affairs. More>>

ALSO:

Auckland Surge, Possible Peak: House Values Accelerate At Fastest Annual Pace In 8 Years

New Zealand residential property values rose at their fastest annual pace in eight years in August, pushed higher by overflowing demand in Auckland, which is showing signs speculators think it has reached its peak, according to Quotable Value. More>>

ALSO:

Cash Money: Reserve Bank Launches New $5 And $10 Banknotes

The $5 and $10 final banknotes were revealed at an event at the Bank in Wellington, and will start to be released from mid-October 2015. More>>

ALSO:

Truck Sales Booted: Commerce Commission Files Charges Against Mobile Trader

The Commerce Commission has filed charges against a mobile trader, or truck shop operator, claiming he obtained money from customers by deception and never intended to supply them with the goods they paid for. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news