Reporting by David Mardiste, editing by Mike Peacock
TALLINN - Estonia's government said on Thursday it had delivered a balanced budget as promised to parliament, although it had a small gap between revenues and spending.
The bill sent by the Finance Ministry to parliament showed spending set at 98.720 billion Estonian kroons ($9.25 billion) and income at 97.843 billion, a shortfall of 0.88 billion kroons.
Despite this gap, the government said the bill was 'derived from a balanced general government sector budget position'.
'It is not correct to say there is a deficit of 0.9 billion kroons as there are different types of accounting (accrual and cash accounting) used in accounting state budget and in calculating the deficit,' the Finance Ministry said in a statement.
'As the Estonian budget is made in one accounting 'style', Eurostat measures in another method,' it added, referring to the European statistics agency, which measures whether countries meet EU budget rules.
Local media disagreed.
'The government has still made a negative budget,' said a headline on the website of daily newspaper Postimees, a view echoed by other newspapers in the country.
The media also said Prime Minister Andrus Ansip had become the first Estonian leader since the Baltic state regained its independence from the Soviet Union in 1991 to send a deficit budget to parliament.
The coalition, led by Ansip's Reform Party, had to drop vows to cut 2009 personal income tax to 20 percent from 21 percent.
The coalition of the Reform Party, the Social Democratic Party and the Pro Patria/Res publica party, held tough talks over whether to cut spending or raise taxes.