Deputy Minister of Finance responded to yet another absurd accusations of Transparency International – Georgia. He explains why they are groundless.
As noted by Mr. Giorgi Kakauridze, Deputy Minister of Finance, primarily it is noteworthy that the referred NGO no longer talks about its first accusations. Alas, MOF allegedly under-executed the State Budget in 2014. Transparency International – Georgia claimed that instead of the officially announced 70.18 MLN GEL, expenditures incurred from the State Budget were by 82 MLN GEL less, thus making the total under-spending over 150 MLN GEL in 2014.
“Nowadays the NGO does no longer focus on its original accusation, as it was absolutely absurd. As we all know, projected expenditures of State Budget in 2014 were 9.8 BLN GEL, out of which 9.1 BLN GEL has been spent in actual terms. That is 70 MLN GEL remained unspent. Projected Tax Revenues amounted 7.2 BLN GEL, while we exceeded the plan by around 11 MLN GEL. This surplus revenues were impossible to be spent without adjusting the Budget. It is not proper to supplement the Budget on 31st December, as numerously stated by Transparency International – Georgia itself and donor agencies. They always noted that adjustments to the Budget at the end of any given year is an inappropriate practice and it has not been done in the past two years” noted Deputy Minister of Finance.
As he further comments, surplus revenues to the Budget of 2014 have been deposited to the Sub-Account of Tax Refunds to make payments out in 2015 to those taxpayers, who paid excess taxes by mistake or otherwise. Around 20 MLN GEL has been refunded already in the current year.
“When we hear from Transparency International – Georgia that such a huge sum has never been deposited to the Sub-Account of Tax Refunds before, let me bring examples to contradict: 120 MLN GEL was deposited at the referred account of the Treasury in the period of December 27-30, 2010, while 190 MLN GEL was accumulated by January 1, 2011” noted Mr. Giorgi Kakauridze, Deputy Minister of Finance.
He also made clarifications on the presentation of Transparency International – Georgia, which relates to the Budget Deficit Indicator quoted by the Ministry of Finance of Georgia on its web portal.
Deputy Minister of Finance once again noted that two data records are published on the MOF website, as public seems to be keenly interested in the methodology of budget deficit calculation. The first one follows current legislation of Georgia, clearly stating that funds deposited at the Sub-Account of Tax Refunds are not captured in the reporting. Respectively, Budget Deficit Indicator is 3.2%. The second one follows Technical Memorandum of Understanding concluded with the International Monetary Fund. In the latter case, Budget Deficit Indicator is 2.95%, which is captured in the overall reporting.
"We plan to make a presentation to NGOs on Budget Execution. Transparency International - Georgia will be invited by all means to make them understand the methodology applied to the calculation of the Budget Deficit Indicator” notes Mr. Giorgi Kakauridze, Deputy Minister of Finance of Georgia.