What’s in the budget for you?
Perhaps the biggest question on the mind of workers was the income tax threshold; but there was not a word of that in the three-hours or so the Finance Minister Dr Ashni Singh presented the 2014 National Budget, which in all adds up to $220 billion.
This means that workers will continue to have to pay 30% in taxes from what they earn above $50, 000.
In addition to those taxes, there is the 16% Value Added Tax that citizens have to bear. There has been no adjustment in that tax in this year’s budget. Last year, over $34 billion was collected from VAT. This year, VAT and Excise Taxes are projected to add up to close to $66 billion.
This year, the government is pumping a further $6 billion into the sugar industry, which last year recorded its worst production figures in two decades.
The rice industry, which last year recorded a bumper crop, is also being given a subsidy of half a billion dollars, for what the Minister said is intended to be used to increase its competitiveness and resilience. The government has also budgeted $200 million to assist farmers improve and expand their business.
We turn now to an initiative the government will spur development in rural communities; a sum of $1 billion has been set aside, and is intended to be used to develop various business ventures in the villages; some persons will even get startup capital. How the initiative will be rolled out has not been detailed, but the opposition sees it as part of the groundwork by the government to win back grass roots support and brighten its prospects whenever local government elections are held.
Regarding the electricity sector, the Guyana Power and Light company is being provided with a subsidy of $3.7 billion; without this, the Finance Minister warned of higher electricity rates. A further $3.2 billion has been budgeted to meet electricity needs in Linden and Kwakwani. The government has been complaining of the exorbitant cost of electricity, especially in Linden; the Minister’s Mathematics puts the average monthly subsidy for Linden households at $23, 000.
Now to the country’s 42, 00 plus Old Age Pensioners. They are getting a 5% increase in their pension – that’s $625; that’s just about a gallon of brown rice a month. Eligible pensioners also receive a waiver on their water charges, and this year, eligible pensioners also get an increase to help them meet electricity charges, in the amount of $30, 000.
The government has this year introduced an education grant, giving parents of children who attend secondary school $10, 000 a year. There is no indication that this grant scheme will continue beyond this year; with criticism already that it is another scheme intended to prop up the ruling party’s chances at Local Government elections.