The Government will not be introducing any new taxes this year, but will instead focus on improving inflows from existing taxes to finance the $520.9 billion budget for the 2013/14 fiscal year.
Making the announcement while opening the 2013/14 Budget Debate in the House of Representatives on Thursday, April 18, Finance and Planning Minister, Dr. the Hon. Peter Phillips, said of the figure, $407.2 billion is projected to be derived from revenue inflows; $103.3 billion from loan receipts; and $10.4 billion from cash balance draw downs.
He explained that of the $407.2 billion in projected revenue, some $360.5 billion is expected to come from taxes, representing a 12.7 per cent increase over the figure for 2012/13. This, he pointed out, includes a full year estimate of the two tax packages announced during the 2012/13 fiscal year.
“The revenue take is almost evenly distributed across the three main tax types: income and profits; production and consumption; and international trade. In this fiscal year, we will concentrate on collecting taxes already imposed. Our compliance rate is well below acceptable standards and must be improved if we are to get out of this debt trap. We will also be streamlining measures previously announced to remove inefficiencies and distortions,” the Minister noted.
Non-tax revenue and the bauxite levy are expected to yield $36.1 billion for the period, compared to the outturn of $19.9 billion in 2012/13. This, Dr. Phillips informed, represented an 81.4 per cent increase reflecting, primarily, the $11.4 billion transfer from the National Housing Trust (NHT). The remaining inflows are projected to come from capital revenue of $1.1 billion; and grant inflows of $9.4 billion, up from a combined sum of $4.9 billion in 2012/13.
“This captures expected grant inflows from bi-lateral and multilateral partners. Some of these flows were being held, pending the conclusion of our negotiations with the International Monetary Fund (IMF),” he outlined.
The Finance Minister further advised that the administration is expected to borrow less to support this year’s budget, with this projected to total $103.3 billion, a significant reduction over the $147.1 billion sourced last year.
He pointed out that the administration intends to borrow $13.8 billion from the domestic market and to which the administration is expected to repay $76. 4 billion, “thereby releasing just under $62.6 billion in resources into the domestic market for lending to the private sector.”
Dr. Phillips spoke under the theme: “Restoring Hope – Expanding Opportunity”.
By Douglas McIntosh, JIS Reporter