Expenditure down, effect of more revenue from tax on deficit

The official financial calculations have shown that under the financial reforms from the government, there has been a decrease in state spending and with an increase in revenue, there is also a decrease in deficit for this year's budget.

As per the weekly fiscal report from the Ministry of Finance and Planning, the state has received MVR 33.5 billion in total revenue and free aid up until 20th November. This is an increase of 9.5 percent of last year's MVR 30.6 billion within the same time frame.

A large percent of the total revenue is shared with the tax revenue received by the state from the government's tax increase. An amount of MVR 25.2 billion was received as tax revenue.

As per the financial calculations, there is an increase of revenue outside of tax up until 20th November compared to last year. The MVR 8 billion revenue outside of tax that has been received is higher than the estimated amount for this year. 

When looking at state expenditure, the state had spent MVR 35 billion until that point. This is around a MVR 5 billion increase compared to the same time frame last year. 

However, such an amount is being seen due to a decrease in capital expenditure. In that time frame, last year's MVR 10 billion capital spending has seen a drop to MVR 5 billion in that same time this year.

Even though the government took steps to decrease state operational spending, the effect of this is not seen in the calculations. Compared to last year, recurrent spending has seen an increase of MVR 1.2 billion, with this amount having increased to MVR 30 billion by 20th November.

As work to harmonize state pay has begun, expenditure on state remuneration has seen an increase to MVR 12.1 billion. This is an increase of around MVR 1.2 billion from last year.

After MVR 4.1 billion was spent to cover state loans and interests up until 20th November, this year's state budget now sees a deficit of MVR 1.5 billion. At the same time last year, the state budget saw a deficit of MVR 9.5 billion.