“At the end of August, the degree of financing this year's gross needs of the state budget included in the Budget Act is About 89 percent We estimate that the state of funds on budget accounts will amount to approx. PLN 180 billion” – said Deputy Minister of Finance Jurand Drop, quoted in the Friday press release of the Ministry of Finance.
The deputy minister also said that In September, two sales tenders and one bond exchange tender are planned. In addition, the resor plans one tender for the sale of tax bills.
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“In July, debt in tax bonds on the domestic market increased by PLN 17.6 billion. The involvement of domestic non -bank investors increased by PLN 18.4 billion, and foreign investors by PLN 4 billion, while debt to domestic banks decreased by PLN 4.8 billion ” – pointed out the deputy minister of finance.
The Ministry of Finance will offer next month at two sales tenders – 10 and 24 September-Tax bonds with a total value of PLN 12-22 billion. The ministry will also organize one tender of tax vouchers-September 5-offering papers on them with a total value of PLN 2-4 billion. Treasury bonds' exchange tender is planned on September 17.
Budget expenditure “on credit”
The sale of state bonds is a way in which the government obtains money to finance expenses when tax revenues and other sources are not enough. If the state budget has a deficit, i.e. it spends more than collecting, the government emits bonds and sells them to investors – banks, funds and private individuals.
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When buying bonds, investors transfer the funds to you now, and in exchange they receive a promise to return after a certain time with interest. Thanks to this, the state can pay salaries, pensions or finance investments on an ongoing basis, despite the fact that there is not sufficient tax revenues.
In practice, this means that some budget expenditure is covered “on credit”, and in the future it will be necessary to pay off the debt and the costs of its service.
