Due to Saud House Corruption, the Kingdom’s Budget Deficit Increases
The Kingdom of Saudi Arabia’s budget deficit widened in the second quarter of this year compared to the same period last year, reaching about nine billion dollars, according to data released by the Ministry of Finance two days ago.
The $8.9 billion deficit is due to a drop in oil revenues of $47 billion in the second quarter, down 5% from the second quarter of last year.
The deficit widened as government spending increased on economic sectors and social welfare programs. The Saudi budget deficit was $1.97 billion in the first quarter of last year.
The deficit widened in the second quarter after the budget posted a surplus of more than $7 billion in the first quarter of this year, the first surplus since 2014.
The data released by the Ministry of Finance showed that non-oil revenues also fell in the second quarter by 4%, while government expectations increased by 5%.
While oil revenues are falling, the kingdom is pumping more money to revive its economy, which is expected to grow for the second consecutive year by 1.7 percent, after shrinking by 2017 by 0.7 percent.
For his part, Minister of Finance Mohammed Al-Jadaan said that the results of the first half of this year confirm the effectiveness of the financial and structural reforms implemented by the government, including the expansion of sources of government revenues through the implementation of initiatives to increase non-oil revenues.
According to the report of the Minister of Finance, the results of the second quarter reflect an improvement in financial performance during the first half of this year, compared to the same period last year, thus contributing to achieve the target results for the current year.
In the data provided by al-Jadan, the budget deficit in the first half of this year amounted to 1.52 billion dollars, compared with 11.12 billion dollars for the same period last year.
Tax revenues on goods and services increased by 48 per cent as a result of the increase in value added tax (VAT) and cash receipts for expatriates, and taxes on trade and international transactions increased by 10 per cent as economic activity improved.
At the same time, oil revenues rose by 15 per cent over the same period last year, driven by the proceeds from oil profits.
The low budget deficit has sparked widespread debate among activists through social networking sites.
