Keith Collister, Gleaner Writer
THE CENTRAL Govern-ment's budget deficit for April of just over $1,201 million was $441 million better than the projected budget deficit for the first month of the new fiscal year of approximately $1,642 million, due to a combination of higher than projected revenues and grants and lower than projected expenditure.
Revenue and grants of $14,840 million were $301 million above the $14,539 million budgeted for the month of April.
While all areas of revenue outperformed except for grants, this positive performance was driven mainly by better than budgeted tax revenues of $13,637 million, which were $293 million above budget of $13,344 million.
The performance of tax revenue in April is particularly encouraging when compared to the performance of tax revenue a year ago, at 20.5 per cent above April 2005's revenues of $11,315 million.
While three of the other four Government revenue areas were above budget projections (non-tax revenues, bauxite revenue and capital revenue were $44.5 million, $52.6 million and $17.9 million above budget, respectively), this was almost entirely offset by the poor performance of grants at $107.1 million below budget.
Overall, these other revenues were approximately $1.2 billion, or nearly flat compared with the comparable month one year ago.
TAX REVENUE DRIVERS
The outperformance of income and profit taxes by $570.9 million relative to budget (which drove the outperformance of tax revenue generally) was entirely due to increased inflows from the tax on interest category ($1,119 million above budget), as all the other components of income and profit taxes (bauxite and alumina, other companies, PAYE and other individuals) under performed, with the exception of flat performance from the relatively unimportant tax on dividends.
Revenues for both of the other main categories of taxes, production and consumption, and international trade, were slightly below projections by $82.4 million and $195.4 million, respectively.
Government expenditure of $16,042 million was $139.5 million below budgeted expen-diture of $16,181 million.
Both recurrent expenditure at $14,955 million, or $123.8 million below budget, and capital expenditure of $1,086 million or $15.7 million below budget contributed to this good performance in April.
BREAKDOWN OF EXPENDITURE
Two of the three main categories of recurrent expenditure - programmes as well as wages and salaries - were below budget.
Programme expenditure was $147.3 million below April projections of $2,200 million, while expenditure on wages and salaries was $59.3 million below projections of $6,462 million.
The third main category of expenditure - interest costs - was approximately $6,500 million or $82.8 million above the budget for April of $6,416 million.
This disappointing performance was driven by domestic interest costs of $5,407 million, or J$163.3 million above the budget of J$5,243 million for this category of interest.
These higher than expected domestic interest costs were only partially offset by lower than budgeted external interest costs of $1,092 million, or $80.5 million below the external interest budget for April of $1,172 million.
