The consolidated budget revenues went up 38.4% this July compared with last July, to 2.63 billion euros (9.4 billion RON).

The over 38% growth pace in July is twice higher than the average of the first six months, when the budgetary revenues rose by 20% in nominal terms in RON, the data revealed by the Finance Ministry on Wednesday show.

In real terms, the increase in the state's revenues was of only 29.2%, because of the inflation estimated at 7.1% between July 2005-July 2006.

Within the state budget, the income and payroll tax collection witnessed the highest increase in July, 56% compared with July 2005.

The growth is primarily due to the taxes that were raised to 16% for gains made from investments; the tax levied in July 2005 in this case was either 1 or 10%. In other words, the increase in the revenue collection for this tax category was made possible by the increase in the taxes on interests, on the transactions with shares and real estate and on dividends.

At the same time, VAT collection achieved an above average increase (42% compared with July 2005), with revenues from this tax reaching 2.59 billion RON (726 million euros).

High VAT collection actually reflects an increase in consumer demand, as the value of the commodities sold in the economy increased. VAT collection provides about one quarter of the state's revenues, if looking at the entire consolidated budget.

Also in July, revenues from the profit tax rose by 34%, revenues from excise duties went up 30% and revenues from customs duties increased by 34%.

The profit tax is paid every quarter for the profit made in the quarter before, and companies usually prefer to settle this debt to the state in the first month of every quarter. Last month was no exception in this regard.

All in all, the revenues of the state budget increased by 37%, totalling 6.4