Trinidad and Tobago Finance Minister Colm Imbert has presented a TT$57.6 billion (One TT dollar=US$0.16 cents) budget to Parliament, providing for a tax amnesty, increase in fuel prices, inter-island travel and those exempt from paying income tax among other incentives.
During a four-hour presentation, Imbert said while the local economy is showing signs of recovery after two years of the coronavirus (COVID-19) pandemic, the government’s fiscal measures came remarkably close to being a balanced package.
He said based on the consideration of all international forecasts for the price of a barrel of oil, the 2022-23 budget has predicated a price of US$92.50 cents per barrel and a natural gas price assumption of six US dollars per Metric Million British thermal unit (MMBtu).
“As a result of these assumptions for fiscal 2023, total revenue is estimated at TT$56.175 billion. Total expenditure is estimated at TT$57.685 billion and based on these assumptions and estimates, we are projecting …that oil revenue will contribute TT$25.19 billion and non-oil revenue will contribute TT$30.15 billion” to the total revenue
He said capital revenue such as the sale of assets will contribute TT$1.006 billion. Colm Imbert said with revenue estimated at TT$56.175 billion and expenditure of TT$57.685 billion “if all goes according to plan, our fiscal accounts in 2023 will be close to balance with a deficit of TT$1.51 billion or 0.8 per cent of GDP (gross domestic product).
Imbert said as a fiscal stimulus to the economy and a fillip to the retail sector, the government is providing relief to working families by increasing the personal income tax exemption limit from TT$84,000 to TT$90,000 annually.
“All individuals earning TT$7,500 a month or less will now be exempt from income tax, “Imbert said, adding that the initiative, which goes into effect on January 1 next year, will benefit an estimated 300,000 workers.
“This bold measure will cost TT$450 million per year in individual income tax revenue, but we firmly believe that in this difficult COVID-19 period it will stimulate the demand side of the economy, economic activity, consumption, sales and growth by putting more money in the hands of consumers.”
He said also the government had agreed to increase the value added tax (VAT) registration threshold from half a million dollars annually to TT$600,000 providing relief and support in the payment of VAT, adding that it will positively impact the development and growth of small and medium enterprises.
The government is also providing incentives for developing the renewable energy sector, particularly in the agricultural sector and Imbert said for approved agricultural holdings the government will offer rebates up to TT$25,000 for the implementation of renewable energy such as solar and wind energy.
The government will also be providing incentives to the manufacturing sector with the finance minister indicating a one-time manufacturing tax credit to companies that make an investment in new machinery, and production lines.
He said the estimated increase in annual revenue for the sea bridge will be TT$30 million, which will still operate at a loss, and would be supported by a subsidy in the amount of TT$170 million a year.
These measures will take effect on January 1, next year.
Opposition Leader Kamla Persad Bissessar will respond to the budget presentation on Friday.
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