Excellent news from Lugano: the 2023 final balance shows a growing surplus

The City of Lugano recently approved its 2023 financial statements, revealing a significant positive surprise: an operating surplus of CHF 12.4 million. This result marks a significant improvement over the projected deficit, demonstrating the city's resilience in the face of a complex and challenging global economic environment.

The year 2023 was characterized by multiple international issues, including inflationary pressures, restrictive monetary policies and geopolitical tensions aggravated by the crisis in the Middle East and the war in Europe. Despite this, Lugano has demonstrated an extraordinary ability to generate positive results: while maintaining a prudent assessment of the final revenue, the Municipality confirmed the expectations defined in the estimate.

However, the revenue from contingent taxes for natural and legal persons recorded a negative difference compared to the budgeted estimates, highlighting the complexity in predicting revenue flows deriving from taxation in previous years.

Despite this, the costs recorded in the final balance were in line with the budgeted values, thanks to savings measures that offset inflationary pressures and the increase in interest rates. Furthermore, revenues excluding tax revenue exceeded expectations, generating a positive difference mainly due to higher additional and withholding taxes.

The overall amount of debt remained substantially stable, despite a slight increase in interest rates. The city was able to issue a bond on better terms than expected, maintaining an average interest rate lower than the inflation rate.

Net investments in administrative assets showed a decrease compared to forecasts, mainly due to the disposal of assets subject to the issue of LALIA contributions, which positively influenced self-financing.

The representatives of the Municipality, presenting the result to the press, expressed satisfaction for the success in guaranteeing financial stability to the city of Lugano, respecting the pre-established economic and financial objectives. The positive result of 2023 confirms a trend of incremental improvement over the three-year term of the legislature, maintaining a financial balance within the estimates of financing needs.