The government estimates the budget deficit for this year at 68 billion euros, or 8.7 percent of gross domestic product.
Last year on Budget Day, it was estimated that there would be a surplus of 2 billion euros. But the measures taken in the corona crisis lead to a major adjustment. With this estimate, government debt would rise to EUR 491 billion, or 63.1 percent of GDP.
Prime Minister Rutte speaks of a budget deficit of an astronomical size. “That this is possible, is due to buffers that we have built up. An enormous apple for thirst, which we fortunately had not eaten.”
Deferred taxes
In the Spring Memorandum in April, the government estimated the budget deficit at 92 billion euros. The fact that the deficit is smaller in the estimate is mainly due to taxes that may be postponed due to the corona crisis.
The idea is that, for the most part, the income will still arrive later in the treasury. In the Spring Memorandum, these deferred payments were not included in the fiscal year 2020, but in the new estimate.
Under European budgetary rules, the deficit should not normally exceed 3 percent of GDP, but it has been agreed within Europe that this limit may now be exceeded due to corona.
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