Quarterly Financial Report
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Republika e Kosovës Republika Kosova – Republic of Kosovo Qeveria – Vlada – Government Ministria e Financave dhe Transfereve - Ministarstvo za Financija i Transfere - Ministry of Finance and Transfers Thesari i Kosovës – Trezor Kosova - Treasury of Kosova ______________________________________________________________________________ Quarterly Financial Report Budget of the Republic of Kosovo For the period 1 January – 31 March 2020 Address: Government Building, 10th floor, Str.”Nëna Terezë”- 10000 Prishtina-Kosovo Telephone/Fax: +383 38 200 34 026/+383 38 212 362 www.rks-gov.net Contents 1. Introduction....... ....................................................................................................................3 2. Receipts and payments for January - March 2020 and comparisons with previous years....6 3. Budget report for period January – March 2020 by months ................................................ 7 4. Kosovo Customs revenues .................................................................................................... 9 5. Revenues from Tax Administration of Kosovo ................................................................... 10 6. Municipalities' own source revenues..................................................................................11 7. Property tax ....................................................................................................................... 12 8. Expenditures ....................................................................................................................... 13 9. Payments from donor designated grants ........................................................................... 14 Annex 1: Data on transfers from the reserve fund ............................................................ 15 Annex 2: Employment data ................................................................................................ 17 Annex 3: Budget and Payments according to Budget Organisations ................................. 19 Annex 4: Expenditures from the fund 22 .......................................................................... 28 Annex 5: Expenditures from fund 23 of PAK and ANSA ...................................................28 Annex 6: Payments according to Article 39.2 LPFMA and Court decisions ....................... 29 Annex 7: Subsidies for public enterprises .......................................................................... 30 Annex 8: Capital projects .................................................................................................... 31 2 1. Introduction This report contains a summary of main trends of budget revenues and expenditures during the first quarter period of 2020. The report contains summarising analyses for the relevant period, presentation of revenues by collecting institutions at the central and local level, details on revenues by type of taxations, as well as comparisons with the previous periods and budget projections. The entry into force of the Law on budget on March 19 and the start of the execution of the 2020 budget with the new budget allocations, according to the new ministerial system organized in 15 ministries (out of 21), presents another challenge for the reporting aspect. Similarly, the beginning of the pandemic situation (Covid-19), namely the announcement of the health emergency situation, although it did not have significant effects in the first quarter of the year as a cumulative, nevertheless had a negative impact on the second part of March, but it was compensated thanks to the good performance of the first two months. 1.1. Revenues Performance Total revenues - during the quarter, the revenues amounted to 402.42 million euros and represent 17% of total projected annual revenues, while compared to the generation of the quarter of the previous year there is a decrease of 13%. Budget revenues amounted to 397.26 million euros, marking an increase of 2%, corresponding to 8.71 million euros more, compared to the quarter of the previous year. This amount of revenues represents 20% of the annual projection, while the increase in relation to the same period of the previous year is mainly as a result of the performance of the private sector, constant improvement of the environment of making business, as well as additional activities from revenue collecting agencies. Tax revenues collected from Kosovo Customs have reached the gross amount of 237.21 million euros, or 19 % of the budget plan for 2020, by marking an increase of 7.24 million, or 3% more compared to the same period of the previous year. Tax revenues collected by the Tax Administration of Kosovo have reached the gross amount of 118.46 million euros, or 21 % of the budget plan for 2020, by marking a decrease of 0.74 million euro, or 0.6% more compared to the same period of the previous year. Non-tax revenues had a generation of 44.81 million euro, or a decrease of 2% compared to the previous year, mainly as a result of decrease of non-tax revenues from the central level for about 3.14 million euro. Revenues from borrowings amounted to 5.16 million euros, including receipts and sub- borrowings. Compared to the same period of the previous year, the generation is lower for 1.89 million euro, while internal borrowings are lower for 24.9 million euros during the reporting period, because the expired securities have only been refinanced and no new issuances have been made in the absence of budget law for the year 2020. Nevertheless, total funding is lower for 71.09 million euros, due to the receipt of one-off financing from the PAK (similarly as in 2019) 3 1.2. Expenditure performance Total expenditures - during the quarter payments amounted to 399.04 million euros and represent 16% of general projected expenditures, while compared to generation of the quarter of the previous year, there is a decline of 1.98 million euros or 0.5%. This period was characterized by the prolongation of budget appropriation (3/12), until the 2020 budget law was enacted late. During this period budget expenditures amounted to 382.84 million euros (including interest payments), thus marking a decline of 2%, corresponding to 7.28 million euros less compared to the previous quarter. o Expenditures for wages and salaries amounted to 154.59 million euros during this quarter, reaching the execution rate of 25% compared to the total annual amount budgeted for this category. Expenditures for wages and salaries during the reporting period marked an increase of 3% or over 5.17 million euros more compared to the salary expenditures of the same period of 2019. o Expenditures for goods and salaries (including utilities) marked the amount of 46.87 million euros, recording a decrease of 2.95 million euros, reaching thus the execution rate of 14% compared to the total annual amount budgeted for this category (including 4.92 million euros of utilities), or a decrease of 12% compared to the same period of 2019. o Expenditures for subsidies and transfers amounted to 143.89 million euros (of which 120.04 million euros social transfers), recording an increase of 4.21 million euros, reaching thus the execution rate of 23% compared to the total annual amount budgeted for this category or 3% more compared to the same period of 2019. o Capital expenditures amounted to 28.36 million euros, which represents a low execution rate, compared to the total annual amount budgeted for this category or the same previous period, as a result of late adoption of the Law on budget appropriations for 2020 as well as a lower intensity of budget execution by budget organizations. o Expenditures for state debt service (interest and principal payment, including returns from sub-borrowings) marked the amount of 24.47 million euros (of which 9.12 million euros interest for public debt), reaching thus the execution rate of 21% compared to the total annual amount budgeted for this category, marking thus an increase of 36% compared to the payments for this category during the same period of the previous year 2019. 1.3. Balance of funds on 31 March 2020 4 The gross balance of funds on 31 March 2020 was 461.09 million Euros. Initial balance of funds to the Budget of the Republic of Kosovo on 1 January 2020 was 458.25 million Euros. As a result of higher receipts than payments (increase in tax revenues) for the period January – March 2020, the balance of funds marked an increase of 3.38 million Euros, compared to the same period of 2019, when the increase was 63.78 million Euros Detailed disclosures about revenues and expenditures are presented in the following tables of this quarterly report for 2020. 5 2. Receipts and payments for January - March 2020 and comparisons with previous years 2018 2019 2020 Difference Description in millions of Euros (2020/2019) 1. TOTAL RECEIPTS 408.52 464.79 402.42 -13% 1.1 Budget revenues 352.06 388.55 397.26 2% 1.1.1 Tax revenues 310.94 342.76 352.45 3% 1.1.1.1 Direct taxes 62.54 68.16 65.88 -3% Corporate Income Tax 19.64 22.18 20.84 -6% Personal Income Tax 36.50 39.79 39.60 -0.5% Property tax 5.59 4.82 5.01 4% Other direct taxes 0.81 1.37 0.42 -69% 1.1.1.2 Indirect taxes 261.54 284.75 294.11 3% Value Added Tax VAT 158.95 170.73 178.69 5% Customs Duty 23.76 25.61 23.90 -7% Excise 78.75 87.75 90.72 3% Other indirect taxes 0.09 0.65 0.80 23% 1.1.1.3 Tax returns (13.13) (10.15) (7.54) 26% 1.1.2 Non-tax revenues 41.12 45.79 44.81 -2% Taxes, charges and others by BOs of Central Government 24.56 26.10 22.96 -12% Taxes, charges and others by BOs of Local Government