News Headline: TEPAV: Limited Positive Impact of Inflation on Incomes Coupled with Low Growth Set to Directly Elevate Budget Deficit

TEPAV has projected that in 2025, the positive impact of inflation on revenues will be more limited, and low growth will directly increase the budget deficit. TEPAV released a report titled "Evaluation of 2025 Budget Targets within the Framework of Program and IMF Forecasts: Potential Challenges in Public Finance for 2025."

The report states, "As highlighted in many recent academic and technical studies, the success of monetary policy in large emerging economies like ours depends on achieving fiscal policy targets. In the medium term, second-generation reforms initiated today will make fiscal success permanent."

The report continues, "If inflation exceeds expectations and no additional measures are taken, it will exert significant pressure on expenditures. Low growth leading to a contraction greater than expected directly reduces tax collection while increasing fiscal pressure on social spending programs. The limited positive impact of inflation on revenues combined with low growth will directly elevate the budget deficit.

In 2025, the lack of preparation of the economic program for different scenarios, the absence of detailed financial measures, and the failure to quantify financial risks are risk factors for fiscal management. Addressing these promptly is seen as crucial for the program's credibility.

In conclusion, understanding the direction-setting policies for change highlights the importance of communication programs. In 2025, the difficulty of political adherence to fiscal measures and economic actors' unilateral perspectives necessitate a multidimensional approach to this complex area."