Bahamas -- Reining in the growth in Government Debt through redre
ssing Recurrent Expenditure and Revenue imbalances,
as well as committing to reducing the fiscal deficit with various structural
fiscal reforms will comprise of a medium term consolidation plan.
"Government policy actions and
decisions through 2016/17 will be guided by the medium term fiscal framework
in the Statement to ensure that we secure the attainment of the fundamental
fiscal targets that we have established. However, given the fiscal slippage
to date in 2012/13, the Statement also enumerated a number of initiatives
to ensure that we meet our 2012/13 GFS Deficit target of 6.5 percent
of GDP," said State Minister for Finance, the Hon. Michael Halkitis.
"At the time of the Budget,
we were projecting a GFS Deficit of $550 million in 2012/13, or 6.5
percent of GDP. With the revised, lower level of GDP this fiscal year,
meeting the Deficit target of 6.5 percent implies a Deficit of $532
Million. Based on experience to the mid-year, Recurrent Revenues have
been revised down this year by $120 million from $1.55 billion to $1.43
On March 4, Mr Halkitis told Parliament
that the Ministry of Finance will, over the balance of the current fiscal
year, exert enhanced monitoring and surveillance over the Recurrent
Expenditures of government ministries and departments such as to secure
a significant reduction in the aggregate level of those expenditures
in 2012/13. He said Finance is aiming to achieve a level of Recurrent
Expenditures this year of $1.72 billion, down by some $101 million from
the Budget projection of $1.821 billion.
"We expect to moderate the pace
of Capital Expenditures below the amounts budgeted. In total, we now
project Capital Expenditures in 2012/13 at a level of $363 million,
down from the Budget estimate of $400 million. Taken together, these
near-term fiscal actions through the end of the fiscal year are projected
to keep us on course and secure our GFS target in 2012/13," said
"The Statement also included
measures to enhance revenue performance in 2012/13 and beyond, including
the improvement of the system for electronic submissions to Customs.
Interim measures were also announced to strengthen compliance within
the real property tax system, in the form of an amnesty programme that
is designed to encourage compliance and payment."
Mr Halkitis said that the Statement
announced a reduction on the Excise Tax on truck purchase from 85 percent
to 65 percent prevailing from before the 2010/11 Budget. He said it
is designed to provide some measure of immediate relief to small business