Central Govt rakes in $280.1B in 1st half of 2023 in revenue collection

– total revenue for 2023 projected at $608.8B

The People’s Progressive Party/Civic (PPP/C) Government has collected a whopping $280.1 billion in revenues for the first half of 2023 with a projected $608.8 billion by year-end.
According to the recent Mid-Year Report issued by the Finance Ministry, the $280.1 billion collected was a result of continued strong economic performance across the various sectors. The first category of revenue is the Central Government’s current revenue.
Current revenue includes revenue from the Guyana REDD + Investment Fund (GRIF), the Natural Resource Fund (NRF), and carbon credit inflows, all of which amounted to $191.4 billion. According to the report, this reflects a growth of 26.5 per cent.
Withdrawals from the NRF contributed $83.2 billion to total revenue, while $4.7 billion was deposited from carbon credit inflows as of the end of June 2023. In the second half of the year, the report projects that $125.2 billion will be withdrawn from the NRF and an additional $26.5 billion will be deposited from carbon credit inflows.
“This performance can be credited to increases within several revenue categories. Tax revenue collections, which accounted for the larger share, grew by $36.7 billion, mainly on account of higher collections of income and value-added taxes. Non-tax revenue collections also increased by $3.4 billion, reflecting growth in the private sector and Bank of Guyana (BOG) profits,” the report stated.
However, internal revenue collections amounted to $117.3 billion for the first half of the year, an increase of 32.4 per cent compared to 2022. The report attributed this to improved private and public sector performances, with private sector corporation tax increasing by $9.9 billion and public sector revenue increasing by $1.2 billion compared to last year.
“This performance is attributed to increased collections from private companies in oil and gas, wholesale and retail trade, and financial and insurance sectors. Further, increased revenue collections of $7.7 billion or 28.6 per cent were recorded from personal income taxes and $7 billion or 30.8 per cent for withholding taxes, driven by improved collections from the oil and gas sector.”
“Value-added and excise tax collections in the first half of the year increased to $49 billion, 13.5 percent over the corresponding period for 2022. Collections from imported goods and services grew by $2 billion due to higher demand for items such as boilers, machinery, and mechanical appliances.”
In contrast, however, excise tax collections decreased by $239.6 billion. This can be linked to the zero-rating of the excise tax rate for petroleum products, which took effect on March 23, 2022, combined with reduced collections from tobacco products and alcoholic beverage imports. The zero-rating of excise tax on oil is one of the measures the Government took to address cost of living concerns.
“In the first half of 2023, collections of customs and trade taxes totalled $15.5 billion, reflecting growth of 16.1 per cent over the corresponding period in 2022. Import duty collections, which accounted for 87.5 per cent of the total share, recorded an increase of $2 billion. Higher imports of food and beverages, vehicles, parts, and accessories and mineral fuels and mineral oils were among the commodities that contributed to this outcome.”
With these developments, total revenues for 2023 are now projected at $608.8 billion. The report explains, however, that fluctuations in the prices of imported commodities can impact local demand for these commodities, and in turn tax revenues, particularly, value added tax, excise tax, and trade taxes.
“For exported commodities, favourable commodity prices encourage more exports and will impact on export duties. On the upside, world prices for a majority of Guyana’s main exported non-oil commodities – rice, sugar, logs, sawn wood, and gold – are tilted to the upside, forecasted to exceed their 2022 levels. This suggests favourable outcomes for 2023,” the Mid-Year Report explains. (G-3)