Methodology
The Hungarian Central Statistical Office (HCSO) started to develop its quarterly statistics on external trade in services with the aim of providing an estimate of Hungary’s external trade in services with monthly frequency based on data coming from VAT declarations. The Office is using, beside VAT declarations data, regression models, too, for estimating monthly external trade in services turnover, and intends to further increase their accuracy based on data collected in the traditional, quarterly way. This development is going to improve the timeliness of the trade in services data, contributing to the estimation of the balance of payments, too.
The basis of the estimation is data coming from T + 421 VAT declarations, where the HCSO is considering the turnover of the external trade in services, and is processing the import and export sides separately. The fact that the methodology applied during the traditional external trade in services data collection (OSAP 1470) contains items that are not obligatory to be reported by the respondents, however these sums are present within the data on VAT related traffic, is a difficulty in the estimation process. Incoming OSAP 1470 survey information reveal that such items exist at numerous companies, these are excluded by the Office, as outliers, from the turnover data of the companies’ VAT declarations. As such the organisations handing in VAT declarations have to be divided into two groups: respondents assigned and not assigned in the OSAP 1470 survey. In the case of the former, based on their turnover-explanations certain items from their VAT declarations are not used by the Office, when it comes to the latter, all external trade in services VAT declaration items are taken into account.
Contrary to previous expectations turnover data regarding external trade in services of businesses cannot be fully classified by groups of services based on EBOPS-TESZOR-TEÁOR categories. The reason is that the largest companies in our country engaged in foreign trade in services cannot be categorized into a business or transport service group based on their activities, as they are primarily manufacturing companies that provide and use various services. As a result, the office publishes only 1-1 main amount on both import and export sides.
Similar to the balance of payments statistics, data reported in present experimental statistic do not include the turnover data of special purpose enterprises (SCVs).
It must be noted that not a comprehensive external trade in services turnover is estimated based on VAT returns as data on the following service groups are not included in VAT returns:
- financial services
- insurance services
- government services
- travel
- FISIM (Financial Intermediation Services Indirectly Measured).
In addition to VAT returns, additional data sources are also necessary for an effective estimate. Such are, for example, bank card data, used on the import side to estimate household consumption; these are received – and processed - by the HCSO from the National Bank of Hungary. Based on these the HCSO prepares a forecast for the given quarter. In addition, airport data collected on the OSAP 1966 questionnaire also contribute in increasing the accuracy of the estimate in both traffic directions.
The office's future goals include the breakdown of the estimated total turnover data into major service groups in order to increase the accuracy of the estimate, furthermore the use of other data collected within the OSAP framework (monthly industrial statistics, external trade in goods as well as external trade in services prices) in the estimates.
Footnotes
-
Day 42 following the reference period. ↩
Methodology
The Hungarian Central Statistical Office (HCSO) started to develop its quarterly statistics on external trade in services with the aim of providing an estimate of Hungary’s external trade in services with monthly frequency based on data coming from VAT declarations. The Office is using, beside VAT declarations data, regression models, too, for estimating monthly external trade in services turnover, and intends to further increase their accuracy based on data collected in the traditional, quarterly way. This development is going to improve the timeliness of the trade in services data, contributing to the estimation of the balance of payments, too.
The basis of the estimation is data coming from T + 421 VAT declarations, where the HCSO is considering the turnover of the external trade in services, and is processing the import and export sides separately. The fact that the methodology applied during the traditional external trade in services data collection (OSAP 1470) contains items that are not obligatory to be reported by the respondents, however these sums are present within the data on VAT related traffic, is a difficulty in the estimation process. Incoming OSAP 1470 survey information reveal that such items exist at numerous companies, these are excluded by the Office, as outliers, from the turnover data of the companies’ VAT declarations. As such the organisations handing in VAT declarations have to be divided into two groups: respondents assigned and not assigned in the OSAP 1470 survey. In the case of the former, based on their turnover-explanations certain items from their VAT declarations are not used by the Office, when it comes to the latter, all external trade in services VAT declaration items are taken into account.
Contrary to previous expectations turnover data regarding external trade in services of businesses cannot be fully classified by groups of services based on EBOPS-TESZOR-TEÁOR categories. The reason is that the largest companies in our country engaged in foreign trade in services cannot be categorized into a business or transport service group based on their activities, as they are primarily manufacturing companies that provide and use various services. As a result, the office publishes only 1-1 main amount on both import and export sides.
Similar to the balance of payments statistics, data reported in present experimental statistic do not include the turnover data of special purpose enterprises (SCVs).
It must be noted that not a comprehensive external trade in services turnover is estimated based on VAT returns as data on the following service groups are not included in VAT returns:
- financial services
- insurance services
- government services
- travel
- FISIM (Financial Intermediation Services Indirectly Measured).
In addition to VAT returns, additional data sources are also necessary for an effective estimate. Such are, for example, bank card data, used on the import side to estimate household consumption; these are received – and processed - by the HCSO from the National Bank of Hungary. Based on these the HCSO prepares a forecast for the given quarter. In addition, airport data collected on the OSAP 1966 questionnaire also contribute in increasing the accuracy of the estimate in both traffic directions.
The office's future goals include the breakdown of the estimated total turnover data into major service groups in order to increase the accuracy of the estimate, furthermore the use of other data collected within the OSAP framework (monthly industrial statistics, external trade in goods as well as external trade in services prices) in the estimates.
Footnotes
-
Day 42 following the reference period. ↩