The operating balance excluding gains and losses (obegal) for the seven months ended January was a loss of $2.5 billion, a $571 million improvement on the forecast deficit of $3.1 billion. At the same time last year, the deficit was $4.3 billion.
The operating balance for the seven months was $4.2 billion, a significant improvement on the forecast deficit of $154 million. At the same time last year, the operating balance was a deficit of nearly $9 billion.
The Treasury chief financial officer Fergus Welsh said two tax types were contributing to the improved tax revenue.
Tax from source deductions was $225 million above forecast. Total labour force earnings were in line with forecast. However, there was a fall in employment concentrated at the lower end of the income scale - for example part-time workers.
Overall, the same amount of income was earned by fewer workers, increasing the average tax rate due to the progressive nature of the personal income tax scale, he said.
Also, tax from other individuals was $277 million above forecast, primarily owing to higher incomes being earned. Part of that was from investment income on the back of strong equity markets.
Core Crown expenses were $282 million below forecast at $39.5 billion. As with the December figures, that was largely due to delays in finalising complex negotiation issues in Treaty of Waitangi settlements, Mr Walsh said.
Finance Minister Bill English said the results were encouraging but the Government would remain ''firmly focused'' on continuing to manage its finances responsibly so it could return to surplus and start repaying debt.
''We will also press ahead with our programme to build a more competitive economy and support the business investment needed for growth and jobs.''
The accounts showed the Crown's investment portfolios performed in the year to January and had recorded net gains of $4.7 billion, around $2.3 billion above forecast.
