Decreasing revenue from taxes and increasing spending with current transfers and payroll have shrunk the surplus of the Macau Government some 50.9 per cent during the first quarter of the year, according to the Financial Services Bureau. While in the first three months of 2014 the government recorded a surplus of MOP37.2 billion, this year the surplus accounted for ‘only’ MOP18.3 billion. Gaming revenue and the overall economy (Gross Domestic Product) shrank 36.6 per cent and 24.5 per cent, respectively, in the first quarter year-on-year. But it’s not only the gaming concessionaires or gaming promoters that are being affected by the slowdown of the economy. Overall, government revenue dropped 32.2 per cent in the first three months of the year from MOP43.8 billion to MOP29.7 billion. For direct taxes alone – the largest source of income for the government, that also includes gaming taxes – roughly MOP11.8 billion disappeared in one year, as revenue from these taxes went down 32.2 per cent from MOP36.5 billion to MOP24.7 billion this year. At the same time, indirect taxes, which include revenue from motor vehicles, tourism and stamp duty, dipped 40.6 per cent from MOP1.4 billion to MOP848.6 million. By contrast, in the first quarter of the year total government expenditure almost doubled from MOP6.56 billion to MOP11.4 billion (73 per cent year-on-year or MOP4.8 billion) during the same period. Increasing social spending While the leader of the Macau Government, Fernando Chui Sai On, said that his second term would focus more on social policies to increase the quality of life of citizens, in terms of spending he seems to be keeping his word. During the first quarter, spending on current transfers increased roughly MOP3.75 billion from MOP1.21 billion to MOP4.96 billion this year, which means an increase of 309.9 per cent year-on-year. Spending on current transfers includes the money handed by the government to different public departments for them to operate but also cash given as social subsidies to private institutions or individuals. However, these figures do not include cash handed to the Social Security Fund, Pension Fund or Macau Foundation among the other five so-called special organisations. The rise of the payroll of the Special Administrative Region, which recorded an increase year-on-year of 19.7 per cent, is another factor that contributed to greater expenditure. While during the first quarter of 2014 the government spent MOP3.1 billion on salaries for the workforce, that number jumped to MOP3.7 billion this year. If on the one hand, the government is investing more in terns of payroll, on the other investment in the region, which includes spending on infrastructure and transportation materials, was cut by MOP38.8 billion from MOP72.4 billion to MOP33.6 billion, representing 53.6 per cent.