Budget 2023 transformational – PSC

The content originally appeared on: INews Guyana
PSC Chairman Paul Cheong

See full statement from the Private Sector Commission: 

The Private Sector Commission (PSC) wishes to commend the Government of Guyana on its presentation of yet another historic National Budget, amounting to $781.9 billion and representing a 41.4 % increase from last year, with no new taxes.

We strongly believe that the architecture of Budget 2023 is well-balanced and caters to the needs of all sectors, which is essential in fostering continuous growth and development of our economy, and improving the quality of the lives of every Guyanese.

The presentation by Senior Minister with responsibility for Finance, Hon. Dr. Ashni Singh, should not only be seen as a financial modus operandi but rather an analytical, rational and logical approach to economic governance.

The policies proposed in Budget 2023 will have far-reaching positive impacts and implications for every citizen.

It is truly a people-centered and private-sector incentive driven budget fit for the purpose of growing and developing our economy. This is evident with measures aimed at improving peoples’ net salary and addressing cost of living rise, such as the increase in the income tax threshold from $75,000 to $85,000 monthly; maintaining zero excise taxes on fuel to absorb the impact of volatile fuel prices and the reduction in freight charges by extending the application of freight cost adjustment for the calculation of import taxes for a 12-month period.

A welcomed feature of the budget is that there are no new taxes, and, when coupled with measures such as removal of the 14 percent VAT with respect to the sale of residential properties, reduction in duty from 45% to 35% on the importation of new motor vehicles (less than four years old) below 1500 cc.; replacement of the current tax rate with a flat rate of taxes of $800,000 on used vehicles (vehicles 4 years and older) below 1500cc and the removal of the currently applicable 14 percent VAT on new electric motor vehicles, there will be cost savings to all Guyanese.

Increased spending in the Housing Sector will translate to more lands & housing being available to the populace; this coupled with an increase in the low-income mortgage ceiling from $15 million to $20 million makes for an exciting future in this sector. The provision of digital solutions to ease public interaction with public institutions will also bring much relief to businesses and the citizenry and reduce inefficiencies in the public agencies.

The budget 2023 contributes to job creation by investing in economic growth and promoting private sector development. The government is introducing several measures to create jobs, such as encouraging businesses to invest in Guyana, increasing the availability of credit for small businesses and creating new job opportunities in the energy and renewable energy sectors.

The budget also increases funding for skills training and vocational education, which will help to create a more competitive labor force.

Additionally, the budget includes funding for infrastructure projects, which will create jobs in the construction sector. Finally, the budget includes tax incentives to help encourage businesses to expand and create jobs.

Investment in education to the tune of $94.4 Billion will benefit the nation in several ways.

First, it increases the number of skilled professionals, which can help the private sector to develop innovative technologies, products and services. Second, it provides a pool of qualified employees that businesses can recruit from.

Third, it gives businesses access to a broader range of ideas and perspectives, which can help to improve business practices and strategies. Fourth, it can help to create a more educated consumer base, which can lead to increased consumer spending in the private sector. Finally, it can help to create a more attractive investment environment, which can attract foreign investment into Guyana.

Injection of $84.9 Billion into the Health Sector is a significant leap taken by the government in achieving a modernized health care system which is paramount in our developmental process. This will improve public accessibility to specialty services which are currently unavailable Further, the Commission recognizes and welcomes the commitment made to create a conducive environment for private sector investment in the small business sector by allocating the sum of $584.2 million towards the Small Business Bureau and the Small Business Development Fund.

As proposed in the budget presentation, the PSC looks forward to the engagement with “the regulator and self-regulatory organizations” to identify practical actions that can be taken to promote capital market development as this would certainly encourage investors in the productive sector to consider the raising of finance on the capital market as a viable option.

Of critical importance to the Private Sector is the continuous investment by the government in infrastructure development as this provides the necessary foundation for economic growth and business activity. Investment in infrastructure allows for the efficient movement of goods and people, which lowers production costs and increases productivity, opens up land for new housing, creates jobs, expand our healthcare facilities and, ultimately, will reduce the cost of living.

The PSC congratulates the Government for another transformational budget.