INSTANT VIEW 1-Slovak budget gap narrows in Jan-Nov

    Dec 1 (Reuters) - The Slovak central state budget showed a 
deficit of 6.98 billion crowns ($259.4 million) in the 
January-November period, compared with a 7.55 billion deficit 
for the same period in 2005, the finance ministry said on 
Friday. 
     
CENTRAL STATE BUDGET   Jan-Nov/06    Jan-Nov/05    FY 2006 PLAN 
 (SKK bln) 
 revenues               262.156       233.706         272.717 
 expenditure            269.139       241.259         330.185 
 balance                 -6.983        -7.553         -57.468 
   
- The budget showed a deficit of 1.08 billion crowns for 
January-October. 
- The state budget traditionally shows smaller deficits than the 
full-year plan throughout the year, but the gap rises in the 
final weeks as state spending grows late in year. 
 
 BACKGROUND: 
- The central budget showed a deficit of 33.886 billion crowns 
for the whole of 2005, much less than the approved ceiling of 
61.524 billion. 
- Slovakia introduced a flat 19 percent tax rate in 2004 as a 
part of an overhaul of its complex tax system. 
- The tax system reform brought higher-than-expected revenues 
last year and the finance ministry projects a further increase 
in tax revenues in 2006. 
- The central state budget data are calculated according to 
local cash-flow methodology as the ministry publishes the key 
public finance statistics according to the European Union's ESA 
95 standards bannually. 
- The cash-flow methodology takes in revenues and expenditures 
when money arrive or leave the state accounts, while the accrual 
ESA 95 method includes revenues and expenditures immediately as 
they occur. 
- The central budget is the major part of public finances. The 
overall public finance deficit ceiling was set at 4.2 percent of 
GDP for 2006, including the cost of pension system reform. 
- Slovakia plans to slash the fiscal deficit to 2.9 percent of 
GDP in 2007 to meet the criteria for euro adoption. 
- Slovakia joined the Exchange Rate Mechanism 2 (ERM-2), the 
precursor to euro, in November 2005, with the crown's central 
parity rate set at 38.4550 to the euro. 
     
MARKET REACTION: 
- The market showed no immediate reaction to the data. The crown 
traded at 35.535 per euro as of 0940 GMT, in sight of its 
all-time high of 35.450 hit on Thursday. 
    
- For LIVE Slovak economic data releases, click on......<ECONCZ> 
- Schedule of upcoming indicator releases............<SK/ECON09> 
- Summary of short-term economic data forecasts......<SK/ECON04> 
 
- Stories on Slovak currency moves........................[SKK/] 
- Slovak speed money guide ..............................<CZK/1> 
- Slovak benchmark state bond prices .................<0#SKBMK=> 
- Slovak forward money market rates ....................<SKKFRA> 
 
  ((Reporting by Martin Santa, Editing by Chris Pizzey; RM: 
martin.santa.reuters.com@reuters.net; 
Email: martin.santa@reuters.com; +421-2-5341-8402)) 
  Keywords: SLOVAKIA BUDGET/