Tuesday, 18 December 2012 02:30
By Carol Williams
Antigua, St. John’s - Government is projected to rake in millions more in revenue through taxes in the New Year, though no new levies have been announced to fund the projected $94 million account surplus.
The additional monies are expected to be generated from increased economic activity buoyed by a 1.0 to 1.2 percent improvement in economic growth; plus an additional $32 million from the Citizenship by Investment Programme (CIP), due to take effect next year; and by tax administration system reforms.
Finance and Economy Minister Harold Lovell made the announcement yesterday in a 3-hour presentation of the 2013 Estimates of Revenue and Expenditure titled “Certainty, Confidence, Credibility: Security, Growth and Sustainability’ that contained no surprises.
“As the global economy slowly recovers, and economic performance in our main tourism markets gets stronger, our domestic economy is expected to experience an uptick in growth in 2013 and 2014,” he said.
“Growth is expected to average between three and four percent over the medium term. Sustainable growth does not simply materialise because our trading partners’ economic circumstances improve. Our economic fortunes will depend on our proactive and calculated efforts to engender economic activity by implementing policies that attract investment and facilitate business development.”
The Antigua & Barbuda Sales Tax (ABST) will yield the bulk of the monies in indirect taxes at $241.4 million or 44 percent. This increase of nine percent over 2012 is due to the anticipated economic growth.
Overall, indirect taxes are expected to yield $550.3 million, while direct taxes, such as Personal Income Tax and Corporate Income Tax, are projected to generate $119.8 million.
“Revenue is trending upwards,” the Minister said, “This was not achieved by wishful thinking or luck. It was achieved through the circumspect, meticulous, studied approach of this Government…”
Recurrent revenue has been budgeted at $757.8 million, seven percent more than last year, while recurrent expenditure is estimated at $786.9, about $5.9 million less than in 2012.
Tax revenue, which accounts for about 88 percent of total recurrent revenue, is budgeted at $670.1 million. Non-tax revenue, comprising the remaining 12 percent, is budgeted at $87.6 million.
The Ministry of Works and Transport is getting about $40 million more for capital expenditure than in 2012. It has been allocated $65 million with an additional $115 million for capital expenditure, compared with last year’s $62.8 million, plus a further $74.5 million for capital expenditure.
The Ministry of Health, Social Transformation & Consumer Affairs is to receive $101.3 million, about $8 million more than last year.
Though the majority of the country’s foreign exchange earnings is earned through tourism, that Ministry is getting just over $4 million less than in 2012 at $38.1 million.
The budget for the Ministry of Finance, the Economy & Public Administration has been slashed by $19 million from what it was a year ago to $88.5 million.
Some $8 million more will be pumped into the Ministry of Education, Sports, Youth & Gender Affairs, which has a budgetary allocation of $84.4 million.
About $7 million less will go to the Ministry of National Security and Labour which has been allocated $69.5 million.
The budgetary allocation for the Ministry of Agriculture, Lands, Housing and the Environment remains virtually unchanged at $16 million.
The Office of the Prime Minister has been allocated $34.2 million, about $4 million less than last year.
Lovell announced that a Medium-Term Strategic Development Plan will be completed in January to succeed the National Economic and Social Transformation Plan “as the Government’s blueprint for growth and development over the short to medium term.”
He said too that Government will focus on creating a business- and investor-friendly environment to secure economic growth going forward.