Taxes flowing to the treasury were $6.5 billion lower than projected as businesses scaled back on trade with the rest of the world. total revenues were off by $8 billion.

Factored in the latter figure is a $1.5 billion shortfall in bauxite levy inflows - a market that is also in decline globally - earning the treasury $3.2 billion instead of the $4.8 billion that was anticipated.

For the first seven months of the fiscal year, the finance ministry collected $135.6 billion of taxes, but had built spending plans around intake of $142 billion.

Projected revenues

Total revenues were projected at $159 billion; but collections came in at $151 billion.

The biggest shortfalls were in general consumption tax, by $3.65 billion, and international trade taxes, by $2.65 billion.

To offset the disappointing revenues, the ministry continued its programme of cuts for capital projects, eliminating planned spend of $6.2 billion.

Instead of $24.2 billion, the ministry issued warrants for $17.99 billion to cover obligations on capital programmes.

The elimination was just enough to cover the shortfall in taxes. Consequently, the ministry squeezed by on its fiscal-deficit target, which ended October at $37.5 billion.

The forecast had been a $37.7 billion.

Fiscal balance

The fiscal balance measures the gap between revenues and expenditures. The budget falls into deficit when spending exceeds total revenues collected.

Jamaica plugs that gap by borrowing. Up to the end of October, the ministry had raised $104.6 billion from Jamaican and overseas sources.

Those funds helped to cover the $71 billion spent on debt-servicing charges on existing liabilities and $78 billion of repayments on maturing debt.

The primary balance narrowly beat its target, coming out at $33.8 billion, against targets of $33 billion.

business@gleanerjm.com