The Ministry of Finance announced last night that revenue intake increased by nearly $92 million during the first six months of the fiscal year.
The government collected roughly $1.1 billion in revenue, a 9.1 percent increase over the previous year, according to a snapshot for the first six months of the fiscal year that was released by the ministry.
Despite the increase, these figures still indicate a significant shortfall for the halfway point in a fiscal year in which the government had originally projected to collect $2.6 billion.
It projected $2.3 billion of that figure would come from taxes.
Post-Dorian, government has revised it revenue projection for 2019/202 to $2.4 billion.
The government has collected $995 million in taxes during the first half of the fiscal year.
There was a nearly 34 percent increase in value-added tax (VAT) collections, with collections increasing to more than $515 million so far this year.
Gaming tax collection nearly doubled to $19.4 million and excise taxes increased by 12.5 percent to $132 million.
Collections from stamp tax on financial and realty transactions fell by $86.3 million.
Speaking about the snapshot in a statement, Deputy Prime Minister and Minister of Finance Peter Turnquest said, “It is promising to see how these initiatives are bolstering our revenue performance.
“This is also the first straight period in which we’ve seen the full impact of the value-added tax rate change, as well as the shift in taxes on real estate transactions, from stamp duty to VAT.”
He added, “We have put in great effort to getting the Revenue Enhancement Unit (REU) up and running, and supporting the roll-out of Click2Clear, the new Custom Electronic Single Window, precisely because these efforts help us to eliminate revenue leakage and improve compliance.”
Abaco and Grand Bahama were struck by Hurricane Dorian nearly five months ago.
The Category 5 storm destroyed thousands of buildings and killed at least 70 people.
It caused roughly $3.4 billion in damage, according to Turnquest.
Dorian had “a significant impact” on the country’s overall performance, according to the snapshot.
“Provisional data on the central government’s budgetary operations revealed a marginal widening in the fiscal deficit to $188.7 million from $174.5 million in the same period of the previous fiscal year,” it noted.
“Although revenue performance strengthened, the outturn was significantly influenced by the government’s initial relief and restoration efforts following the devastating Hurricane Dorian on the islands of Abaco and Grand Bahama.”
As a result, the finance minister last night noted that the government is “cautiously optimistic” about the forward outlook.
“We recognize that our decision to provide a wide range of tax concession[s] for the people affected by the hurricane is going to result in additional foregone revenue in the months ahead,” Turnquest said.
“We are satisfied this is the right policy, however, in keeping with our values to put people first and ensure Abaco and Grand Bahama bounce back.
“We are also executing a number of new capital projects associated with the reconstruction. With these projects, we are thinking progressively about the country’s future needs, and strategically prioritizing initiatives such as solar energy infrastructure with short and long-term benefits.”
He said the net effect of these efforts will “likely see a substantial deficit” in the second half of the fiscal year.
On Wednesday, Turnquest announced that a combination of lost revenue from Abaco and Grand Bahama in the aftermath of Dorian, along with associated spending and un-budgeted items not related to the storm, is projected to push the country’s fiscal deficit for 2019/2020 to a record $677.5 million.
He said the government is projected to borrow an additional $587.9 million to cover the revenue shortfall and expenditure increase.