The Coalition Government has exceeded expectations in its provisional final fiscal performance report for the 2023-2024 financial year. The report indicates an improvement over previous years, highlighted by a lower-than-anticipated budget deficit and a decrease in debt levels.
The reported deficit stands at $443.6 million, which constitutes 3.4% of GDP, significantly better than the projected 4.8% deficit in the original budget. This figure is also a notable reduction from previous years, with deficits recorded at 7.1% in 2022-2023 and 12.1% in 2021-2022, suggesting enhanced management of government spending.
Total revenue for the year reached $3,645.9 million, equivalent to 27.7% of GDP, surpassing expectations due to stronger tax and non-tax collections. Revenue has increased by an impressive 32.6% compared to the previous year. Tax revenue alone amounted to $3,096.8 million, exceeding forecasts by $60.9 million, a 2.0% increase.
Economic recovery in tourism and other sectors has primarily fueled this growth. Tax collections saw a rise of 35.5% compared to last year, with significant contributions from VAT, corporate tax, and departure tax. Additionally, non-tax revenue reached $549.2 million, also surpassing expectations through income from dividends, grants, and asset sales.
Shiri Gounder, Permanent Secretary of the Ministry of Finance, emphasized that maintaining fiscal and debt sustainability is a key priority for the government. He stated that the fiscal consolidation path has been strengthened through well-designed revenue reforms and expenditure policies, alongside a robust economic recovery. The positive trends in vital sectors like tourism and improved business confidence following the announcement of the FY2024-2025 National Budget further bolster the economy.
By July 2024, government debt was reported at $10,309.2 million, marking 78.3% of GDP, a decrease from 82.0% in 2022-2023 and 90.6% in 2021-2022. The debt structure consists of 63.9% domestic debt and 36.1% external debt.
Despite these encouraging results, Gounder warned of ongoing risks. He noted that while growth momentum is expected to improve—driven by the launch of key tourism projects and government initiatives—there are potential challenges. Global developments, a shortage of skilled labor, weather-related disturbances, and capacity constraints in some sectors could impact the economic outlook.