Greece Records €4.52 Billion Primary Surplus in H1 2025, Outperforms Budget Target

Primary Surplus More Than Doubles Budget Target

Greece achieved a primary surplus of €4.519 billion in the first half of 2025, significantly exceeding the government’s target of €2.235 billion, the Finance Ministry announced Friday. This performance also outpaces the surplus recorded during the same period in 2024, which stood at €2.905 billion.

Despite a state budget deficit of €564 million, this is far lower than the expected €2.795 billion, and reflects sound fiscal management, front-loaded tax revenues, and timely expenditure control.

Revenue Performance Surpasses Expectations

State Budget net revenues amounted to €34.381 billion, marking a €484 million or 1.4% increase over projections. After adjusting for special transactions related to past-year concessions, the actual revenue overperformance climbs to €1.834 billion—a significant 5.6% above target.

Main drivers of revenue growth:

• Tax revenues: €32.208 billion, +7.5% (or €2.236 billion above target)
• PIT (Personal Income Tax): +€1.095 billion due to earlier tax submission platform opening
• CIT (Corporate Income Tax): +€43 million
• Other Income Taxes: +€269 million
• VAT revenues: €12.886 billion, +€316 million
• Excise taxes: €3.432 billion, +€93 million
• Property taxes: €1.697 billion, +€120 million

Timing of Income Tax Collections Provided Early Boost

A crucial factor contributing to the surplus was the early availability of the income tax return platform, leading to PIT collections worth €944 million that were originally expected in July. This early collection provided a temporary fiscal cushion, though it reflects a front-loading rather than an increase in overall obligations.

Expenditures Below Target Despite Year-on-Year Increase

State Budget expenditures for January–June 2025 stood at €34.945 billion, €1.746 billion lower than the budget target. While overall expenditure increased by €1.223 billion compared to H1 2024, this was primarily driven by higher health and public service support spending.

Key spending areas:

• €594 million in hospital and regional health authority funding
• €400 million for Public Service Obligations (electricity sector support)
• €290 million for EKAPY (centralized public health procurement)
• €158 million in grants to public transport (OASA, OASTH, OSE)
• €115 million to universities

Investment spending stood at €5.051 billion, €88 million below target, and €109 million lower than in H1 2024.

Adjusted Fiscal Metrics Reflect Resilient Performance

Source: pagenews.gr