Missed primary surplus target strains budget

Belize’s more austere budget will cause many to pinch their change.

PRAYER ALERT on missed primary surplus target. Belize will miss its primary surplus target of 3.1% of GDP by almost half. Now it expects the PST to be 1.8%. That means far less money for its budget including payments on its burdensome $2.3 billion Superbond debt. Last year the last-minute restructuring of that debt lowered Belize’s interest rate. That gave Belize hope to get on track for recovery from its current recession.

But the recession has dragged on for another year, resulting in revenue shortfalls. During that year Belize’s debt-to-GDP ratio rose to an alarming 93.8%. Still, Prime Minister Barrow has promised no new taxes to boost revenue. Instead the PM is increasing current taxes and removing tax exemptions. This is drawing protests from opposition leaders.

They object to applying a 12.5% tax on formerly exempt Business Process Outsourcing expenses. That would discourage foreigners from outsourcing work to potentially thousands of Belizeans. They object that agricultural activities such as land clearing, crop dusting, harvesting and bean processing will rise in costs. Consequently costs of basic food items such as rice, beans, corn, chicken, and eggs will also rise. They object that the tax on formerly exempt data purchases will burden data-users, which is just about everyone these days.

Of course, it’s precisely because this taxation affects so many Belizeans that it would produce much-needed revenue. But will the resulting higher costs slow down the recovery even more? We must pray for divine help to lift Belize from its two-year-old recession.

PRAY WITH US. Father God, we look to You as Provider. You see us stuck in debt and recession. We don’t make enough money to get out. So we tax more, leaving our citizens with less to spend. And we borrow more, deepening our debt. Our creditors have already extended our grace period. We cannot ask them for more. But we ask for an extended grace period from You, who let Your Son die on the cross that we may have new life.

Turn us from our wicked ways of over-borrowing and over-spending. Expose and correct all corrupt and illegal uses of money. Entrust more wealth to the really good and faithful public servants who will produce more wealth. Bless our fields and our orchards and our harvests from the sea. Bless our tourist sites. Glorify Yourself as Creator and Sustainer of our beautiful Belize. And show us all Your plans to prosper us, plans to give us hope and a future in You. In Jesus’ name, amen.

DailyInsightProsperity gives you more opportunity to sin. Poverty forces you to seek His greater power (see Mt. 5:3).

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Keyword: missed primary surplus target.

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elize recession continues with missed primary surplus target

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