Government budget no longer in the red for the first time since the corona crisis | NOW

The government had a budget surplus of 7 billion euros in the first quarter of this year, Statistics Netherlands reported Friday. It is the first time since 2020 that the government has written black figures again. This is due to the strong economic growth that resulted in more tax revenues.

The Dutch economy barely grew in the first quarter of this year, but last year our country recorded the largest growth in more than twenty years. This was mainly due to higher exports and higher household consumption. This higher consumption continued in the first three months of this year, causing companies to record record profits.

The combination of all this led to more tax revenues, which pushed the budget out of the red, explains CBS chief economist Peter Hein van Mulligen.

In 2020, the Netherlands still had a deficit of 34 billion euros. At the time, this was mainly due to the substantial support packages that the government had to give to companies because of the mandatory closure, while hardly any taxes came in. Those subsidies continued last year and the first three months of this year, but the impact on the budget was much smaller, according to Van Mulligen, due to the strong growth.

Debt also fell by 3 billion euros to 446 billion euros. That’s 50.7 percent of gross domestic product (GDP), the most commonly used measure of economic activity in a country. A year ago, that debt still amounted to 55 percent of GDP. The EU requires countries to keep their debt below 60% of GDP.