State Income 40 Billion above Estimates Skip to content

State Income 40 Billion above Estimates

The gross income of the state treasury in 2009 is much higher than had been anticipated, reports.

Steingrímur J. Sigfússon.

A total of 398 billion ISK was expected but the result was just under 440 billion ISK. This is stated in the government account, which will soon be presented.

According to Fréttabladid’s sources, income tax has delivered much more than was expected. This means that the expected decrease in wage development did not occur. Also, unemployment was less than expected. This can probably be explained by the fact that the decrease in GDP was not as great as had been feared.

The economic forecast predicted a 9 percent unemployment rate in 2009 and 9,6 percent in 2010. According to the managing director of the Directorate of Labor Gissur Pétursso, the estimation last year was 8 percent.

“We are hoping that it won’t increase this year. We assumed 8,5 percent at the beginning of the year, but now we are sensing a decrease.”

Despite the increase in income, it will turn out to be a similar percentage of the GDP as had been expected, or 28 percent. It however appears that they won’t reach expectations as a proportion of the GDP in 2010, even if things are going well.

According to the Minister of Finance Steingrímur J. Sigfússon, these results are great news and a sign that the economy has shrunken less than was estimated.

He emphasizes that this figure includes an advance in the collecting of capital tax, meaning that this is not entirely comparable with figures from previous years.

“In fact, the success of the restraint measures is even more pleasing. The expense budgets are holding and well beyond that,” said Sigfússon, adding that the state institutions have done well in saving and very few of them exceeded the 4 percent limit of overspending.

“Here, we have reached an important goal, which is first and foremost thanks to managers and employees of ministries and state institutions.”

According to Fréttabladid’s sources, the higher income means fewer cutbacks in the 2010 national budget.

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