Turnquest: Deficit reduced by more than $130 million
The government reported yesterday that the nine-month budget performance report shows it has steadily closed the deficit gap.
According to a press release issued by the Ministry of Finance, the ministry’s quarterly report shows strong revenue performance in the third quarter of the fiscal year.
Deputy Prime Minister and Minister of Finance Peter Turnquest said in the release that the government reduced the deficit by more than $130 million in the first nine months of the fiscal year compared to the same fiscal period last year.
“That’s a 51 percent improvement,” Turnquest said.
“And notably, in this third quarter we achieved a $40 million surplus, a substantial improvement over the $7 million deficit for this same third quarter last year. Our performance is steadily moving us towards closing the deficit gap, but we must maintain expenditure discipline to ultimately meet our year-end target.
“Let us not forget, in addition to financing the ordinary cost of government, we have budgeted to pay off $172 million in old bills in this fiscal year, so we have limited room to maneuver. Through the end of March, we’ve settled over $110 million in these old bills. To be able to pay off such a backlog of arrears, while still reducing the deficit, is no easy feat; it depends on us being disciplined. I have said many times before, we must stay the course and it is no different this time.”
The release states that seasonal business license receipts and increased value-added tax (VAT) revenue and stamp taxes created a boost in revenue that bolstered third quarter results.
“Business license performance not only met our expectations for the customary third quarter boost, but it is noteworthy that business license revenue was up by 35 percent,” Turnquest said.
“This underscores the fact that the economy is strengthening and expanding and that overall, business receipts are improving. It also reflects the fact that the Department of Inland Revenue has seen an uptick in the number of businesses being regularized and in the number of new registrants.”
According to the release, the move from VAT on real estate transactions to stamp tax on those transactions netted a “two-fold increase in the yield from $80.6 million a year ago to $161.6 million in this fiscal period”.
The release notes that non-tax revenue also increased by $20.7 million while immigration fees were also higher by $20.9 million because of recent fee increases.
“This equated to 89.3 percent of the budget target,” the release points out.
However, the release adds that expenditures for the review period also increased by $86.5 million due to growth in rent, utilities and the purchase of goods and services, as well as the settlement of budgeted arrears.
- Two web shops file lawsuit against AG, prime minister - May 28, 2020
- Govt accelerating move to digitalpayment systems - May 28, 2020
- DPM on budget: Govt will not sugarcoat economic troubles - May 27, 2020