Jamaica’s Finance Minister, Audley Shaw, on Thursday formally announced that the government will not be introducing new taxes to fund the 2018/19 Budget which, amounts to approximately J$773.6 billion.
Fund budget from revenue and grants
Shaw, who opened the budget debate said the government plans to fund the expenditure budget from revenue and grants, which are “passively” forecast at $590.6 billion or 29.3 per cent of gross domestic product (GDP), among other sources.
In his speech, themed ‘Stability, Growth and Prosperity – Our Goal, Our Responsibility’, Shaw said tax revenue this year is budgeted at $518.4 billion, representing 25.7 per cent of GDP.
This sum, he indicated, is expected to account for 87.8 per cent of total revenue and grants, compared to the 88.8 per cent projected out-turn for 2017/18.
Non-tax revenue is forecast to be $60.9 billion or three per cent of GDP, representing a 14 per cent increase over the revised 2017/18 Estimates, which amounted to 2.8 per cent.
The projected out-turns in this category include receipts of $5.4 billion from Customs administration fees; transfers of $12.7 billion from the de-earmarked entities – the CHASE Fund, Tourism Enhancement Fund, and Jamaica Civil Aviation Authority; and a special distribution of US$101 million from the PetroCaribe Development Fund.
Shaw said capital revenue is programmed at $2.1 billion, with grants projected to total $9.1 billion or 0.4 per cent of GDP.
The Finance Minister advised that Central Government’s borrowing requirements for 2018/19 amounts to $103.2 billion.
He said that of the budgeted receipts, $78.1 billion is programmed to be raised domestically and $25.1 billion externally.
‘This borrowing requirement represents a 48.4 per cent reduction in total loan receipts when compared with fiscal year 2017/18. The lower borrowing (year-on-year) requirement reflects the significantly lower amortization costs for fiscal year 2018/19 and the planned utilization of existing cash resources,” the Minister added.
Shaw also reiterated the Government’s undertaking to continue the tax reform program.
Significant budget increase for National Security
Concerning funds for the Ministry of National Security, Shaw said there has been an increase of 23.4 per cent, moving to $78.5 billion up from $63.6 billion in 2017/18. The Finance Minister said the increase will facilitate the provision of machinery and equipment, and implementation of physical infrastructure and social-intervention programs.
Shaw said projects to be undertaken in the new fiscal year include construction of new facilities for the Jamaica Defense Force (JDF) and Jamaica Constabulary Force (JCF); expansion of crime-fighting training facilities; building and improvement of several correctional facilities; procurement of motor vehicles and other specialized equipment to respond to both physical threats and cyberattacks; and continuation of social-intervention initiatives.
He said the Government has identified national security and the rule of law as among the main strategic priorities for fiscal year 2018/19 and for the medium-term.
Prime Minister budget contribution March 20
The debate will continue on March 13, when the opposition’s spokesman on Finance, Mark Golding, will make his contribution.
The Debate will continue on March 15, with the Leader of the Opposition, Dr. Peter Phillips, followed by Prime Minister Andrew Holness, who will speak on March 20.
Shaw is scheduled to close the Debate on March 21.
