Reform measures of MVR 11.5 billion, MVR 6.6 billion to be saved from expenditures alone

The proposed budget for 2025 projects savings of MVR 11.5 billion through fiscal reform measures.

The total budget proposed for next year comes to a total of MVR 56.6 billion. This is a 1.8 billion increase from the current year's budget, including the supplementary budget recently passed.

Presenting the proposed budget to Parliament today, Minister of Finance Moosa Zameer said that it is essential to increase State revenues sustainably to ensue fiscal sustainability.

As such, the budget document states that MVR 6.6 billion can be saved though the fiscal reform measures that are to be taken to overcome the economic difficulties currently faced by the country. Last year, too, a target had been set to save MVR 2.5 billion through reform measures, however this was not achieved as the reforms remained unimplemented.

According to Zameer, the fiscal reform measures include transferring to a direct subsidy system. reforming Aasandha services, decreasing risks that arise with fuel price changes, reforming SOEs and decreasing wastage in pension expenses.

Even with this, next year's expenses are projected to be at MVR 49.2 billion. This includes recurrent expenditure of MVR 35.9 billion and MVR 13.3 billion in capital expenditure.

The budget also includes plans to increase revenues.

Next year's revenue is expected to be at MVR 39.8 billion, including MVR 4.9 billion which is expected to be received through revenue increasing measures.

These measures include increases in tobacco tax, TGST, airport tax and green tax from next year onwards.

With these fiscal reforms, next year's deficit is expected to be at MVR 9.4 billion, which is the lowest deficit in recent years.