Turkey’s public budget swung to a surplus in July, after tax increases on a wide range of essential goods boosted the government’s revenues.
(Bloomberg) — Turkey’s public budget swung to a surplus in July, after tax increases on a wide range of essential goods boosted the government’s revenues.
Income grew 156% last month from a year earlier, driven by a surge in value-added taxes on domestic consumption, which rose more than fivefold during the same period. Spending climbed 74.7% from last year, allowing the government to record a surplus of 48.6 billion liras ($1.8 billion), from a deficit of nearly 220 billion liras a month earlier.
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The rapid improvement in the budget shows Treasury and Finance Minister Mehmet Simsek’s policies might be paying off. Simsek pledged better public finances after taking over in June, when the budget gap was widening due to increased spending before President Recep Tayyip Erdogan’s reelection in May as well as two devastating earthquakes that took place in February. The government last month tripled taxes collected from fuel and raised the value-added levy by two percentage points.
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