Minister of Finance Ibrahim Ameer has proposed a state budget of MVR 42.6 billion for 2023 in keeping with the rising annual pattern.
The proposed budget for 2023 is MVR 42.68 billion and is significantly higher than the state budget approved for 2022. Including the supplementary proposed budget, the total state budget will come up to MVR 42.8 billion.
Approximately 70 percent of the state budget is allocated for state governance and salaries which amounts to around MVR 29 billion. A budget of MVR 14 billion has also been set aside for public sector investment programs and development projects.
If the GDP levels can be kept at the projected level, the budget deficit for the following year is predicted to be MVR 8 billion. However, the budget deficit might rise to MVR 14 billion if the GST is not raised and tax revenue falls short of expectations.
The state budget for 2023 comprises mainly six sectors. MVR 5 billion will go towards the development of the health sector, MVR 3.9 billion to the preservation of the economy, MVR 4.6 billion will be allocated to the education sector, MVR 2 billion for environmental protection, MVR 2.8 billion for housing projects, and MVR 10.4 billion towards industrial growth.
In parallel to income taxes, the government must raise an additional MVR 11.3 billion to manage the state budget. MVR 8.9 billion of that sum goes toward the deficit, MVR 1.1 billion is forecasted for loan repayment, and MVR 4.8 billion is allocated to the SDF fund. The money will be raised by internal bond and t-bill sales as well as the sale of green or blue bonds on the international market.
The projected economic forecast for 2023 is to increase GDP levels to MVR 104 billion, bring in 1.8 million tourists and to increase reserves to USD 606 million.
In his presentation of the budget to the People’s Majlis, Minister Ameer reiterated that the budget was prepared with achievable targets. The budget is also forecasted to fulfill the pledges of the current administration led by President Ibrahim Solih.
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