Serbian parliament adopts 2013 budget revision

The Serbian parliament adopted on Friday, with 129 votes in favor and 55 votes against, the 2013 republic budget revision bill, which projects a deficit of RSD 178.3 billion or 4.7 percent of GDP, Tanjug news agency has reported.

According to the Serbian government, the reforms stemming from the revision will be key to stabilization of the economic situation.

The revision projects total budget revenues of RSD 873.4 billion, which is 92.3 billion less than originally anticipated, and total expenditures are planned to amount to RSD 1051.7 billion, a decrease of about RSD 36 billion.

Budget deficit has been increased by RSD 56.4 billion against the originally planned deficit of RSD 121.9 billion, or 3.3 percent of GDP.

The government's intention behind the revision was to cut spending and strengthen fiscal discipline.

The measures to reduce expenditures, the government said, involve reduction of discretionary expenditures and introduction of new rules for planning expenditures for salaries and pensions involving savings measures in the public sector at all levels.

One of the most important measures to increase revenue collection is full tax discipline, which involves suppression of illicit transactions and strict control of tax collection, according to the revision bill explanation.

Presenting the bill to the MPs, Minister of Finance and Economy Mladjan Dinkic said that given the global economic situation, the Serbian government had to adopt a package of measures to stabilize the republic budget and restructure public enterprises, and the budget revision is only one of the measures.

The entire package of the government's measures consists of two parts - one is the revised budget, which does not provide for any increase in tax rates, but only for the strengthening of fiscal discipline and collection of tax revenues, and the second part includes restructuring and reforming public enterprises, which means that the state will make room for new owners in them.

The RSD 36 billion budget savings were made by reducing subsidies by RSD 7.8 billion, to 83.9 billion, and by reducing capital expenditures by RSD 13.1 billion, to 33.7 billion, and the greatest savings wee achieved through the reduction in discretionary spending by the ministries, Dinkic said.