6 Jul 2017

Govt surplus beats expectations

11:14 am on 6 July 2017

A higher tax take and lower spending has helped boost the government's coffers.

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Photo: 123RF

Excluding investment gains and losses, the operating surplus stood at $4.49 billion for the 11 months to May, compared with the $2.9bn surplus that had been forecast.

The growing economy boosted tax revenue, which came in $1.1bn above expectations at $69.5bn.

A higher corporate tax take due to rising profits made up two thirds of the improvement, with a stronger GST take making up most of the rest.

Expenses came in below expectations, at $69.3bn.

The Treasury is forecasting a $1.6bn surplus in the June 2017 year.

"While these surpluses are significant, they will be needed to meet the cost of the significant investments we have committed to as part of the next four Budgets including the government's $32.5bn infrastructure programme," Finance Minister Steven Joyce said.

If investment gains and losses are included, the operating surplus stood at $13.1bn.

Net debt totalled $59.3bn, or 22.4 percent of the value of the economy.

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