By Sue-Ann Wayow
GOVERNMENT has lost billions in projected revenue for the period October 1, 2020 to April 30, 2021 with the biggest shortfall coming from non-tax revenue.
Finance Minister Colm Imbert on Tuesday disclosed figures received for the seven-month period during a virtual press conference hosted by the Ministry of Finance to deal with financial matters and Covid-19 relief programmes.
Imbert who gave the Mid-Year review Budget statement in Parliament last week, went into further detail as to where exactly the government fell short on its revenue earnings.
He said the forecasted total revenue for that period was $22, 956,000,000. The actual amount collected was $20.45billion, a shortfall of $2, 505,000,000.
In giving the breakdown of the shortfalls, Imbert said from oil and gas companies, the shortfall was $409million, other companies, just under $119million, from individuals, the shortfall was approximately $28million and the chunk of the shortfall came from non-tax revenues, an approximate figure of $1billion.
Imbert said, “ The negative variants were due to lower than anticipated receipts received from taxes from incomes and profits, non-tax revenue, capital revenue and items such as the Unemployment Fund and the Green Fund. This was offset to some extent by higher than projected receipts on taxes on goods and services which is mainly Value Added Tax (VAT) and taxes on international trade which is Customs Duty.”
He said, “The lower and projected income on taxes and profits was primarily due to lower taxes from oil companies where oil and gas companies, the shortfall in revenue was $409million during that seven-month period. For other companies, it was $119million. So the shortfall on the other companies which is not oil sector and all of the various industries that we know, manufacturing, retail, construction and even the petrochemical sector, the shortfall was just under $119milion.”
Referring to shortfall from individuals, Imbert said Government collected almost all what was projected and there was a shortfall in withholding tax which is directly related to the energy sector.
He gave explanations concerning the non-tax revenue.
“Non-tax revenue is where royalties on oil and gas are counted. If I look at non-tax revenue the projection was based on a projected production of 3.2billion standard cubic feet of gas per day and gas price was about US$3 per mmbtu. The royalty would have been if we had achieved those levels approximately $2.9billion, $2,911,000,000.
“We in fact only collected $1,83,000,000 so there is a significant shortfall there because of lower than estimated production of gas and significantly lower price in gas than anticipated so there was a shortfall there of $1.8billion.”
He added that there was also a shortfall in extraordinary revenue from oil and gas companies where as a result of certain negotiations the government was to receive significant sums of money up to $1 billion dollars annually if prices were good.
However, since prices were significantly below estimates for gas in particular, there was a shortfall from extraordinary revenue of $330million.
