2022-2023 Budget Restores Pay Cut; Introduces No New Tax Revenues

John Briceño

Looking at the projections for the 2022-2023 budget, PM Briceño says Government must remain cautious. The nation’s economy is vulnerable to several factors, including inflation, climate change, rise in fuel prices, and the threat of another wave of COVID-19 infections, to name a few. PM Briceño did not introduce any new, major tax revenue measures in the budget. The new budget also restores the 2020-2021 wage levels to teachers and public officer. Notwithstanding, government Administration projects one point one billion dollars in recurrent revenue for 2022, with a projected increase in both tax and none tax revenues. On the expenditure front, total expenses are expected to rise by twelve percent.

Prime Minister John Briceño

“Recurring revenues are projected at one point two billion dollars, which is seven point five percent over, or eighty six million dollars higher than the forecasted outturn for this fiscal year. More tax and none tax revenues are projected to rise. Our capital revenues will remain constant and grants will fall to thirty five million dollars, in line with our bilateral agreements. Revenue growth is consistent with the six point five percent overall G.D.P.  growth forecast of the I.M.F. for 2022 and the Central Banks slightly more modest six percent forecast. On the expenditure’s side, overall spending will rise compared to this year’s projected outturn by a hundred and forty four million dollars, or twelve percent. These increases include the following major spending lines, wage and pensions will rise by ten percent or forty nine million dollars. Most of this attributed to the ten percent wage restoration which is to commence on July first. Subsidies and transfers will rise by thirty seven million dollars or twenty five percent, which is mostly in direct wage subsidies linked to the wage restoration. Debt service will rise by twenty four million dollars as we commence interest payments on the Blue Bonds. Capital spending will rise by thirty million dollars compared to this year’s outturn of two hundred and forty three million dollars. In summary therefore, the new budget targets a primary surplus of some fourteen million dollars, or point three five percent of G.D.P., along with an overall deficit of ninety eight million dollars, or two point four nine percent of G.D.P. Government proposes to retire ninety seven point four million dollars in public debt during this year’s budget cycle. Total financing required for this budget will be one hundred and ninety five point six million dollars.”