Ministry of Finance: Expenditure growth has decreased, indicating slowdown in expansion of public spending relative to GDP

 Total revenues to the consolidated budget amounted to 531.55 billion RON in the first 10 months of 2025, up by 12.3% (year/year) and by one percentage point as a share in GDP, and expenditures totaled 640.42 billion RON, up by 9.9% and by 0.53% as a share in GDP, according to the 10-month execution published by the Ministry of Finance."Analyzing the evolution of the share of budget expenditures in GDP, we note that the growth rate in the current year has decreased compared to the previous year, indicating a slowdown in the expansion of public expenditures reported to the GDP level," the Ministry of Finance claims.The evolution of revenues in the first ten months of the year was determined by current revenues (+0.63 pp), mainly payroll and income taxes, insurance contributions and excise duties, and by European funds (+0.38 pp).Revenues from payroll and income taxes totaled 48.62 billion RON, registering an increase of 19.5% (year/year), determined by the significant advance of revenue from dividend tax (+71.8%), on account of dividends distributed in 2024, with the retention of the 8% tax rate.At the same time, a positive dynamic was also recorded in the case of payroll tax receipts (20.7%), above the dynamics of the wage fund in the economy (10.0%), the evolution of this category of income being influenced by the elimination of tax facilities granted to employees in the construction, agricultural, food industry and computer software development sectors, the Ministry of Finance emphasizes.According to the Ministry of Finance, the evolution of the wage bill in the economy reflects the dynamics of the average gross wage (9.6%) and the number of employees (0.4%) recorded between December 2024 and September 2025 compared to December 2023 and September 2024.Insurance contributions registered 172.89 billion lei, recording an increase of 10.5% (year/year), close to the increase in the wage bill in the economy. The evolution of these receipts was also influenced by an effective transfer to the Second Pillar of pensions higher than that achieved in the first ten months of last year (18.6 billion RON in January-October 2025, compared to 14.7 billion RON in January-October 2024) but also by the elimination of exceptions from the CASS payment regulated by Law no. 141/2025.Income tax revenues amounted to 38.14 billion RON, recording an increase of 15.8% (year/year), supported by the advance of income from income tax from economic agents.Net VAT receipts amounted to 108.38 billion RON, marking an increase of 9.2% (year/year). The evolution of these receipts can be explained both by the advance of VAT refunds (+7.8%), compared to the level reimbursed in the same period of last year (27.2 billion RON in January-October 2025, compared to 25.2 billion RON in January-October 2024), and by a higher base effect. The evolution of these receipts was also influenced by the effects of the provisions of Law no. 141/2025 on the modification of VAT rates, the relevant ministry claims.Revenues from excise duties amounted to 39.66 billion lei, recording an increase of 10.2% (year/year), in the conditions of positive developments in excise revenues for energy products (+15.7%) and excise taxes for tobacco products (5.0%), also influenced by the effect of the increase in the level of excise taxes according to Law no. 141/2025. The monthly evolution of excise revenues generally presents a higher volatility, determined by the policy of economic operators of fiscal warehousing of excisable products, specifies the Ministry of Finance.Non-tax revenues amounted to 46.32 billion RON, up 9%, an evolution supported by payments from the BNR's net revenues and revenues from the sale of greenhouse gas emission certificates.The amounts reimbursed by the European Union on account of payments made and donations totaled 40.59 billion RON, up 31.9% (year/year).General budget expenditures increased by 0.53 percentage points in GDP compared to the same period in 2024, from 33.14% of GDP to 33.67% of GDP.Personnel expenses amounted to 140.34 billion RON, up 5% compared to the same period of the previous year. Expressed as a share of GDP, personnel expenses represent a level of 7.4% of GDP, 0.2 percentage points lower compared to the same period of the previous year. "Against the backdrop of reductions in bonuses for some categories of budgetary personnel as well as measures to limit salary expenses, for the year 2025, at the level of November 2024, personnel expenses have registered a decreasing evolution starting with July, so that in October they are 500 million lei lower compared to October 2024," the document published by the Ministry of Finance shows.Expenditures on goods and services were 79.71 billion RON, up 5.5% compared to the same period of the previous year. An increase is reflected in local budgets, respectively 3.3% compared to the same period of the previous year, as well as in the budget of the National Single Fund for Social Health Insurance, 9.8% for the settlement of medicines with and without personal contribution and medicines used in national health programs.Interest expenses were 46.77 billion RON, 13.91 billion RON higher than the same period of the previous year.Social assistance expenditures amounted to 209.12 billion RON, up 12.7% compared to the same period of the previous year. The evolution of social assistance expenditures was mainly influenced by the implementation of measures to recalculate public pensions starting from September 1, 2024, in accordance with the provisions of Law no. 360/2023 of November 29, 2023 on the public pension system. Social assistance expenditures were also influenced by payments from the state budget to compensate for electricity and natural gas consumption bills, respectively for the 10 months of 2025, they amounted to 2.86 billion RON.Subsidy expenditures were 10.06 billion RON, mainly this amount represents subsidies for passenger transport and support for agricultural producers, as well as for the compensation scheme for electricity and natural gas consumption of non-household consumers (909.08 million RON).Other expenses amounted to 13.37 billion RON, mainly representing scholarships for pupils and students, support for religious institutions, other civil compensation and amounts related to payment titles issued by the National Authority for Property Restitution.Expenditures on projects financed from non-reimbursable external funds (including subsidies from the European Union related to agriculture) were 51.44 billion RON, up 24.56% compared to the same period in 2024.Investment expenditures, which include capital expenditures, as well as those related to development programs financed from internal and external sources, amounted to 96.04 billion RON, 8.65% higher than the same period of the previous year, when they amounted to 88.40 billion RON.The execution of the general consolidated budget for the first ten months of 2025 ended with a deficit of 108.87 billion RON, respectively 5.72% of GDP, down by 0.55 billion RON compared to the deficit recorded in the same period of 2024 of 109.42 billion RON, respectively 6.22% of GDP.After the first nine months, the deficit was 5.39% of GDP, and for the entire year the target is 8.4% of GDP.