Costa Rica’s fiscal deficit reaches 622 billion colones

SAN JOSE, COSTA RICA – September 20th, 2012 – According to the Treasury department (Hacienda), the fiscal deficit reached an accumulated total of 622 billion colones (about $1.2 billion USD) in August.  That is the equivalent of 2.9% of the nation’s internal GDP.

Treasury Minister, Edgar Ayales, said that despite the fact that tax revenues continue to grow, the rate of growth has slowed, decreasing from more than 11% in July to 10.4% in August.

Income from consumption tax was lower due to a decrease in vehicle and electric household appliance imports.

While government income decreased, government expenses continued to increase during August.

Government expenses increased by 10.7%, mostly attributed to inflation-based salary increases, as well as expenditures for the CCSS (Costa Rican Social Security) and universities.

By the end of the year, the Treasury department expects the fiscal deficit  to represent 4.5% of internal GDP.

Ayales expects additional government investment in infrastructure for 2013 and 2014, which could help boost economic growth.