Reducing budget deficit a challenge says Minister

The greatest challenge in working on the 2012/2013 national budget is reducing the deficit to the lowest possible figure, while trying to maintain the number of services the Government is providing, Vasant Bharath, Minster in the Ministry of Finance said yesterday. He was responding to questions from the media  at a Trade Facilitation forum hosted by the T&T Manufactuer’s Association and T&T Shipping Association at the Hyatt Regency, Port of Spain, just hours before Prime Minister Kamla Persad-Bissessar officially announced the 2012/2013 National Budget will be presented on October 1.

Bharath was asked what was the greatest challenge the Government is facing in trying to work out the 2012/2013 fiscal package. “The greatest challenge is to bring the deficit to the lowest possible figure. We inherited a deficit of just over $7 billion and we have to ensure that we continue to provide some of the essential services,” he said

Some of the major expenditure that impacts heavily on the state’s coffers, the minister said, inlcudes gasoline which is currently being subsidised. Also subsidised are Caribbean Airlines and major social programmes. “But we want to keep some of the programmes because there are many people who do have the same level of job opportunities. We need the social programmes as a social net to catch those people,” Bharath said.

He said Government is unable to cut away some of these initiatives immediately, but will do so on a phased basis. Bharath could not say whether there would be some adjustments to the various subsidies.He said the challenge is to keep the deficit at its lowest possible number, while maintaining the number of services government currently provides.

On the issue of whether the property tax would be re-introduced in the budget, Bharath did not know if that would be announced in the budget but  said the government plans to keep its campaign promise “What I can tell you is that the government made a commitment a couple years ago that there would be no new taxes and we would revert to the previous amounts people paid,” he said.

Bharath admitted that the Government is experiencing some challenges with regards to instituting the old policies under the Land and Building Tax. He said while the government clearly needed revenue and funding from any area matters, “we have a commitment to the population and we are planning on sticking to it.”