The January to May 2018 fiscal performance shows that the Total Revenue and Grants fell short of target by GH¢1,428.7 million, representing 0.6 per cent of GDP, while total expenditures were below target by GH¢796.5 million (0.3 per cent of GDP).
That resulted in a cash fiscal deficit of GH¢6,371.8 million, representing 2.6 per cent of GDP, against a target of GH¢5,739.5 million (2.4% of GDP).
Mr Ken Ofori-Atta, Minister of Finance, presenting the 2018 Mid-Year Fiscal Policy review to Parliament, said “We anticipate that at this rate, if remedial actions are not taken, the end-year fiscal deficit target could widen mainly on the back of lower revenues”.
“Our analysis indicates that, without additional efforts, Total Revenue and Grants would amount to an estimated GH¢49,610.4 million (20.5% of GDP) or 2.8 percent lower than the original Budget target of GH¢51,039.1 million (21.1% of GDP).
“Of the Total Revenue and Grants amount of GH¢49,610.4 million, non- oil Tax Revenue is estimated at GH¢37,500.5 million (15.5% of GDP) compared to our original budget estimate of GH¢39,001.8 million (16.1% of GDP),” he added.
Mr Ofori-Atta said, on the other hand, Total Expenditure (including the net change in arrears clearance), would amount to an estimated GH¢61,451.6 million (25.4% of GDP), GH¢558.7 million lower than the programmed target of GH¢62,010.3 million.
He said the resulting fiscal deficit would amount to GH¢11,841.2 million (4.9% of GDP), against a programmed target of GH¢10,971.1 million (4.5% of GDP).
“This will derail our fiscal consolidation efforts and put our objective of reducing the public debt profile at risk. A net fiscal adjustment of GH¢870 million (0.4% of GDP) would be required to ensure that we achieve our fiscal deficit target of 4.5 percent of GDP,” he said.
The Minister said to ensure that the achievement of the 2018 fiscal objectives and target are not derailed, this mid-year review affords them the opportunity to propose sustainable revenue and expenditure measures for the consideration and approval from Parliament.
These measures, he said, include new tax measures, strengthening of tax compliance and expenditure adjustments.