NASSAU, BAHAMAS — The government exceeded its revised revenue target for the fiscal year 2021/2022 by nearly $270 million, with revenue collections during the period totaling just over $2.6 billion, according to the Ministry of Finance.
The Ministry of Finance in its 12 months fiscal snapshot for the fiscal year 2021/2022 noted that despite contractions in global growth, The Bahamian economy maintained a steady pace of recovery, supported by rebounding tourist arrivals.
According to the Ministry of Finance, revenue collections during the fiscal year 2021/2022 totaled $2,608.6 million, an increase of $700.7 million over the prior fiscal year and 111.5 percent of the revised budget target.
It further noted that improved revenue performance also represents an increase of $364.1 million over original revenue forecasts for the fiscal year, despite the reduction in the nominal VAT rate from 12 percent to 10 percent beginning January 1, 2022.
“Key improvements in tax revenue were noted for value-added tax (VAT) of $395.7 million, excise duties of $81.7 million, departure taxes of $74.2 million, customs and other import duties of $56.2 million, stamp taxes (financial and realty) of $25.5 million, license to conduct the special business activity of $19.4 million, and gaming taxes of $13.5 million,” the Ministry of Finance said in a statement.
“Growth in non-tax revenue was largely driven by immigration fees of $31.2 million, and interest and dividend receipts of $37.0 million, of which, The Government received a dividend of $24.5 million from BTC during the second quarter.”
Total expenditure aggregated $3,298.1 million (95.6 percent of the budget) and represents a $54.5 million increase over the prior. That total included $251.4 million in supplementary financing approved in May 2022 to settle an equivalent amount of arrears and claims on Government owing from prior fiscal periods.
“In recurrent expenditure developments, compensation of employees grew by $24.4 million to $725.3 million, largely owing to reinstatement of increments, promotions, and other discretionary benefits withheld during the COVID-19 induced economic downturn. Other key items include $633.4 million for the acquisition of goods & services, $551.8 million in public debt interest payments, and $491.6 million in subsidies to government-owned and/or controlled enterprises.”
The ministry continued: “Capital expenditure contracted by $87.4 million to settle at $283.6 million as capital transfers to support businesses impacted by the pandemic lessened by $37.4 million. The acquisition of nonfinancial assets contracted by $50.1 million to equate to $224.8 million, as spending on “other structure” (which comprises transport-related infrastructure such as ports, roads, and bridges) declined by $46.5 million.”
It was pointed out that the prior year’s spend was elevated by a $68.4 million allocation to construct a new hospital tower, with the net result being a deficit of $689.5 million, a $646.2 million decrease from the deficit of $1,335.7 million in the prior fiscal year.
