Greece’s economy is moving at a rapid pace with significant target overperformance, appearing to record a mammoth primary surplus for the second consecutive year, which could exceed 10 billion euros by the end of the year. According to preliminary state budget execution data, the primary surplus for the seven-month period of January–July 2025 reached 7.96 billion euros, compared to an annual target of just 3.59 billion euros.
This performance exceeds last year’s corresponding levels by 2.3 billion euros (5.66 billion euros for the same period), confirming the economy’s resilience and the tax administration’s effectiveness.
Read: State budget: 2.1 billion euro surplus for January – July period
Primary surplus in state budget: Tax revenues and electronic transactions as catalysts
The explosive trajectory of tax revenues serves as the driving force behind fiscal overperformance. Total net budget revenues for the seven-month period reached 42.86 billion euros, exceeding the target by 822 million euros (+2%). Of these, tax revenues amounted to 40.56 billion euros, increased by 2.27 billion euros or 5.9% compared to the target.
Particular contributions came from:
• Income tax, reflecting employment expansion and wage increases,
• VAT, whose revenues were strengthened both due to inflation and the reduction of tax evasion through increased electronic transactions.
Additional revenues and fiscally neutral transactions
Part of the net revenues was enhanced by special transactions, such as:
• The new Attiki Odos Concession Agreement, with revenues of 784.8 million euros (fiscally neutral for 2025, relating to 2024).
• The expected collection of the price for Egnatia Odos (1.35 billion euros), which had not yet been completed by July and is estimated to be recorded within the coming months.
Excluding the above, net revenues show an increase of 2.17 billion euros or 5.3% compared to the target, with enhanced tax revenues as the dominant factor.
Expenditures below target – Significant savings margin
On the expenditure side, the state budget recorded significant restraint. Total expenditures for the seven-month period reached 40.67 billion euros, falling short of the target by 3.32 billion euros. This reduction is attributed to:
• Delays in transfers to insurance funds and general government entities (–2.2 billion euros),
• Timing differences in defense expenditures (–605 million euros).
Key transfers from the Regular Budget include:
• 726 million euros to hospitals and Regional Health Authorities,
• 400 million euros to cover Public Service Obligations in the energy sector,
• 377 million euros to EKAPY for pharmaceutical procurement,
• 208 million euros to OASA, OASTH and OSE,
• 115 million euros for higher education institution support.
Investment expenditures: Slightly reduced, but strengthened compared to 2024
Public investment expenditures reached 6.13 billion euros, 34 million euros below target, but increased by 32 million euros compared to the corresponding period last year.
Fiscal space ahead of Thessaloniki International Fair and stability
The picture reflected in the seven-month fiscal data creates positive expectations for the remainder of 2025. The government, with the backdrop of Thessaloniki International Fair announcements, gains additional fiscal space to proceed with permanent tax reliefs and income support measures amid high inflationary pressures. This supersurplus proves that the fiscal strategy based on increasing revenues through compliance, transparency and technology is bearing fruit, without the need for additional taxes or cuts.
