The latest public finance report by IMSEE shows that Monaco recorded a budget surplus of over €32 million in 2022, four times the previous year, thanks largely to the government’s real estate portfolio and a boost in VAT. 

Created using the state budget and the Constitutional Reserve Fund (CRF), IMSEE’s report shows that Monaco’s 2022 budgetary revenues and expenditures had both risen on the previous year.

Outgoings saw an 8.3% rise, hitting €81.5 million, but the incomings were the big news, showing a €24.2 million increase to reach €32.2 million, equalling four times the 2021 amount.

STATE INCOME AND COSTS

This increase in state revenues is due primarily due to tax revenues, which were up 16.3% to €200.2 million, and more specifically to commercial transactions, commonly called VAT, which saw a 14.5% leap of €126.3 million. The only category which saw a downturn was the finance sector, down a massive 72.6%, though the report attributes this to exceptionally high revenues in 2019 and 2021.

Expenditures reached just over €2 billion last year, a 15.8% increase compared to 2021. IMSEE says this is the result of investment and equipment expenses, which are nearly €1 billion of the total. Public intervention outgoings sat at €399.5 million, a moderate uptick of 5.1%, or €19.4 million, and operating costs went up by 10.4% to €62.1 million, with public services taking up the lion’s share of this with an increase of 31.9% in 2022.

CONSTITUTIONAL RESERVE FUND (CRF)

The CRF had a healthy €6.5 billion in assets at the end of last year, and includes €2.2 billion in liquid assets stemming from financial investment and bank deposits, a “non-liquid” portion coming in at €3.9 billion composed mainly of properties and the government’s holdings in companies, and a gold reserve of €312 million.

The vast majority of properties held by the CRF generate rental income. As for the companies, these include shares in SBM, SMEG, SMEAUX, the Grimaldi Forum, Monaco’s Ports and the like, which bring in roughly €1.4 billion.

Monaco’s state budget had a surplus of €8 million in 2021, a deficit of €103.2 million in 2020, and a budget surplus of €3.8 million in 2019. The significant rise of 24.2 million in revenue in 2022 still falls short of 2018’s budget surplus of €38.4 million.

Some of the biggest influences on Monaco’s budget surplus/deficit over recent years have included the Covid-19 global pandemic, major construction projects such as One Monte-Carlo and the Hôtel de Paris renovation, and new housing for Monegasques.

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