Minister of Finance and Treasury Ahmed Munawar stated on Thursday that the decision to sell bonds worth USD 100 million to fund government projects, will be left for the upcoming administration.
Speaking at the parliamentary committee in charge of reviewing the 2019 State Budget of MVR 29.6 billion, Munawar stated that there were major difficulties in managing cash flow because the state did not receive MVR 700 million in taxes as per the financing plan.
However, Munawar assured that all preparations have been finalised to raise the USD 100 million bond as per by the financing plan. However the selling of bonds have been left in the hands of the future government that will be led by President-Elect Ibrahim Mohamed Solih.
“The management of the cash flow have been discussed with Emirates National Bank of Dubai. This loan is essential to manage the cash flow of the government,” said Munawar.
In addition, he stated that the current government had introduced new policies on generating revenue over the past two years, although the future regime has to come up with proper methods that will help increase the state revenue. Although the government revenue had declined, the minister pointed out that the upcoming administration promised to implement income taxes.
Munawar suggested that despite the increase in government spending, Proper research must first be conducted in order to implement a proper tax system.
Furthermore, he highlighted that the International Monetary Fund (IMF) has extended assistance to establish a tax unit in the ministry.
The budget passed by the government for this year approved the auction of bonds worth of USD 200-300 million. The money from selling the bonds have been expended on development projects.