2018/19 Budget Communication 2018_2019 BUDGET COMMUNICATION | Page 111

down - are estimated to produce a net gain in revenue of
some $100 million while the VAT increase should net new
revenue to the tune of some $400 million. As a result, after
factoring in the growth of the economy and targeted gains
from enhanced revenue collections, total Recurrent Revenue
in 2018/19 is estimated at a level of $2,649 million, or 20.1
per cent of GDP. That is an improvement in the revenue
yield of 4 full percentage points from the level of 16.1 per
cent posted in 2017/18. While still lagging behind regional
norms, such a level of the revenue yield is definitely more
reasonable in relation to the needs of modern governance.
The GFS Deficit in 2018/19 is therefore projected at
$237 million, some $73 million lower than in 2017/18. At
1.8 per cent of GDP, the deficit will come in at the target
that will be mandated in the fiscal responsibility legislation.
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