Germany will face a budget deficit due to the record number of refugees

Moscow. October 22. The crisis caused by the influx of a record number of refugees will lead to a small budget deficit of Germany in 2016, predicts the Ministry of Finance. With this expected surplus,

“In 2015, the government expects a small budget surplus – wrote the Deputy Minister of Finance of Germany Thomas Steffen in the monthly report, which quotes The Wall Street Journal. – However, the current forecasts for next year indicate a nearly balanced budget in connection with increase of costs, mostly on the acceptance and accommodation of refugees”.

The state budget includes the budgets of Germany at the Federal level, at the level of individual länder and local authorities, as well as the costs of the social security system.

Earlier in October, it was decided that the Federal budget is nearly doubling the costs to support the regions in connection with the necessity of detention of refugees.

This year Germany expects 800 thousand to 1 million migrants, that is, four times last year’s level. According to local authorities, the placing costs 800 thousand new workers this year will be about 15 billion euros or 9.6 billion euros more than in 2014.

As expected, Germany will not increase the issue volumes of government debt in the current year due to higher than expected tax revenues due to economic growth and low unemployment.

In 2014, Germany reached a budget balance for the first time in more than 40 years (since 1969). The surplus last year amounted to 0.3% of GDP, while the results of the two previous years was registered a slight deficit of about 0.1% of GDP.