THE National Assembly on Thursday approved the landmark $781.9 billion budget for the fiscal year of 2023, thereby clearing the way for continued social and economic transformation.

Senior Minister in the Office of the President with responsibility for Finance Dr Ashni Singh wrapped up the Consideration of Estimates, and reported to the National Assembly that the proposals were thoroughly scrutinised by the Committee of Supply.

Following the passage of the budget, Dr. Singh commended his colleagues as well as members of the Opposition for meticulously examining the Estimates and posing questions to government ministers on various line items under each sector, and by so doing providing an opportunity for the public to get a better understanding of what is in the budget.

Since January 23, both sides of the House participated in five days of debates, following which there were four days of Committee Supply meetings.

Budget 2023, the country’s largest to date, is the fourth budget to have been presented by the People’s Progressive Party/Civic (PPP/C) administration since being elected to office in August 2020.

It was presented this year under the theme: “Improving Lives today; Building Prosperity for Tomorrow.”

This year’s budget is the largest ever, and despite being 41.4 per cent bigger than Budget 2022, it is fully financed, and has no new taxes.

It is the second budget that will benefit from financing from the proceeds of Guyana’s new and emerging oil-and-gas sector, following the historic passage of the Natural Resources Fund (NRF) Act, which addressed the most “offensive deficiencies” of the predecessor Act.

Budget 2023 also benefits from continued financing through projected withdrawals from the Natural Resource Fund (NRF) of US$1 billion this year, the equivalent of G$208.9 billion, to finance developmental priorities.

This year’s budget has placed Guyana on the world stage as being the first country to receive such a payment, valued at US$75 million under an agreement that will be worth a minimum of US$750 million up to 2030.

Two more payments of US$37.5 million each will bring the total amount appropriated in this year’s National Budget to US$150 million.

The payment came about as a result of the government’s continued recognition of the important role of the country’s forests in the development of Guyana, and combatting climate change globally.

On December 1, 2022, the Architecture for REDD+ Transactions Environmental Excellence Standards(ART-TREES) announced the issuance of 33.5 million credits to Guyana for the period 2016 to 2020.

Dr. Ashni Singh, during his presentation last month, said: “Budget 2023 strikes a balance between addressing the pressing needs of today and the critical investments needed for tomorrow, ensuring that both are attended to.”

As he went on to say: “Budget 2023 also reflects a number of measures that are geared towards providing further stimulus to economic activity and the productive sectors, as well as to bring relief to households and individuals.”

PAVES THE WAY
The passage of this budget paves the way for the government to continue working towards achieving the vision of world-class standards of education and healthcare.

The sum of $84.9 billion is for the health sector, and $94.4 billion for the education sector, so as to ensure that the country’s young people are prepared for the future.

More importantly, within these, there is an allocation of $13.1 billion to advance work on the paediatric and maternal hospital, and six regional hospitals at Lima, De Kinderen, Diamond, Enmore, Bath and No. 75 Village, as well as $12.4 billion to improve education infrastructure countrywide.

This year’s Budget also caters for a number of large projects that will transform the country’s energy supply, including provisions for the construction of an integrated natural gas liquids plant, and a 300 MW combined cycle gas turbine power plant within the Wales Development Zone.

Dr. Singh had said that this project “represents the single largest investment made in the electricity sector, and the single largest Engineering, Procurement and Construction contract undertaken.”

Among other large infrastructural projects is the upgrade and widening of the Corentyne Highway, from Palmyra to Crabwood Creek, for which $27.7 billion has been allocated.

The sum of $16.6 billion has been allocated for the upgrading of the East Coast Railway Embankment Road into a four-lane highway, from Sheriff Street to Orange Nassau, continuing to the Mahaica River Bridge.

It will also continue the upgrade of the East Coast Highway from Belfield to Orange Nassau, and the construction of a second bridge across the Hope Canal.

A further $10.3 billion was also successfully allocated for the construction of the East Coast – East Bank Road linkage from Ogle to Eccles (the first phase of a four-lane highway intended ultimately to link the East Coast of Demerara and the Soesdyke-Linden Highway).

Another major infrastructural project under the landmark budget is the New Demerara River Bridge, the first high-span, four-lane permanent hybrid concrete and cable-stayed structure, for which $5.2 billion has been allocated to advance works.

BACK INTO POCKETS
The people-centred budget also places a sum of $50 billion back into the pockets of citizens through the proposed increases in old-age pension, public assistance and the income-tax threshold, along with other cost-of-living measures.

The income-tax threshold has been increased by another $10,000, taking it from $75,000 to $85,000.

As a result of the adjustment in the tax threshold, over 12,000 persons will be removed from paying income taxes, while every single taxpayer will benefit one way or another.

Public assistance has also been increased from $14,000 to $16,000. Over 29,000 persons are set to benefit from this initiative, which will provide over $700 million in additional disposable income to these individuals.

The low-income mortgage ceiling has also been increased to $20 million, up from $15 million, reducing the cost of borrowing within this range from the commercial banks, and further incentivising home ownership.

Also, in support of the government’s aggressive housing drive and efforts to reduce the cost of home ownership, the 14 per cent VAT with respect to the sale of residential properties has been removed.

In making vehicle ownership cheaper, the government has reduced the duty from 45 per cent to 35 per cent on the importation of new motor vehicles below 1500 cc, which will reduce the cost of importing such a vehicle by approximately $200,000.

In relation to used vehicles below 1500 cc, the government will be replacing the current tax rate with a flat rate of taxes of $800,000, which will reduce the cost of importing such a vehicle by $300,000 on average.