It is highly likely that Jamaicans will experience an eighth consecutive year of no new taxes based on preliminary details given by the Government as it tabled its historic trillion-dollar national budget.
Finance and the Public Service Minister, Dr Nigel Clarke, tabled the historic Estimates of Expenditure for fiscal year 2023/24 in the House of Representatives on Tuesday afternoon.
The largest single item of expenditure in the budget is the $338 billion for wages and salaries for public sector employees, under the Government’s flagship compensation review programme.
“In line with the requirements of the Financial Administration and Audit Act, I am tabling today, for the fiscal year 2023/2024 budgetary documents which provide an outline of the Government’s plan for the country over the medium term,” said Clarke.
“Building on the achievements of fiscal year 2022/2023, the government plans to spend $1 trillion in fiscal year 2023/2024. This is Jamaica’s first trillion dollar budget,” he declared.
The minister highlighted that the amount is allocated across the main expenditure categories with $665.7 billion or 22.5 per cent of Gross Domestic Product (GDP) allocated to non-debt recurrent expenditure; $75.3 billion or 2.5 per cent of GDP will go towards capital expenditure; and $280.6 billion representing 9.5 per of GDP is set aside for debt servicing.
“Included in the non-debt recurrent expenditure are allocations to implement the second year of the three-year public sector compensation restructure and allocations to operationalise the independent Fiscal Commission…,” Clarke stated.
He said the allocation for capital expenditure takes into account the existing capacity of the government to implement capital programmes, and focuses on the priority areas to enhance development.
The finance minister said that debt service at 9.5 per cent of GDP which includes amortisation (principal repayment and interest payments), reflects action taken over prior years to reduce the debt burden.
Of note is that interest payments this year of $155 billion will be fully financed by revenue. This is a clear sign that Jamaicans will not be faced with any new taxes for an eight consecutive fiscal year.
Clarke said the overall public debt is estimated to end the current fiscal year on March 31 at 79.7 per cent of GDP.
