Government presents $383.1B National Budget
─ range of new measures to improve citizens’ quality of life
Government, today, presented a historic $383.1 billion national budget, Guyana’s largest fiscal plan to date, with a range of transformative measures to improve the quality of life of all Guyanese.
Themed “A Path to Recovery, Economic Dynamism and Resilience,” the 2021 national budget has also been financed without any new taxes.
Senior Minister in the Office of the President with responsibility for Finance, Dr. Ashni Singh made the four-hour long presentation to the National Assembly, being hosted at the Arthur Chung Conference Centre, Liliendaal.
Added to the wide range of public investment projects and initiatives, were several new measures to bring relief to households and businesses amid the difficulties brought on by the COVID-19 pandemic over the last year.
Among those measures are a reduction in the cost of basic food and other household items through zero-rated value-added tax (VAT).
The Government has also proposed a five per cent reduction in water tariffs across the board, targeting all levels of consumers.
With the construction sector boosting the country’s economy, Government has also announced the zero-rating of some construction materials. These include stone imported for construction and housing from CARICOM, locally produced pre-stressed concrete piles, locally fabricated, mild, steel beams for building construction, and locally manufactured roofing and PVC products for building construction. Industrial grade cement duty has also been reduced from 15 to 5 per cent.
In fulfilment of another one of its manifesto promises, the Government has also restored the zero-rated status to various food items and basic household necessities which the previous administration had removed from that list. These include basic wheaten flour, basic breads, oats, unflavoured cracker biscuits, cooking oil, locally produced bedsheets and pillowcases and toothbrushes.
The Finance Minister also announced an increase in the low-income mortgage loan ceiling from $10 to $12 million. Such loans can be obtained through commercial banks under the low-income housing loan programme.
The ceiling for housing loans at the New Building Society (NBS) has also been increased from $12 million to $15 million, enabling borrowers to access financing from the NBS within that range.
The cost of connectivity will also be reduced with the removal of VAT on data for residential and individual use.
Transportation cost in the hinterland will be reduced with the removal of duty on all-terrain vehicles for use in those areas.
In the education sector, the Government would be introducing a cash grant of $15,000 per child to be given to the parents of children in the nursery, primary, and secondary schools in the public school system.
And as promised in Budget 2020, Old Age Pension has been increased from $20,500 to $25,000 effective January 1, 2021. This will benefit over 60,000 persons and put an additional $4 billion of disposable income in their hands.
Public Assistance, which benefits over 13,000 vulnerable Guyanese has been increased from $9,000 to $12,000 per month. This will provide an additional $500 million in disposable income to these individuals.
Dr. Singh said the Government will reinstate the original position where the sale of assets owned for more than 25 years would not attract capital gains tax on their disposal. The Administration will also restore zero-rated status for VAT purposes which the Government had for the provision of imported goods and services purchased by Budget Agencies.
Dr. Singh said Budget 2021 outlines policies, programmes and projects that will catalyse economic growth, which will see billions of US dollars of private investment realised across several sectors of the economy.