2016-2017 Budget – Planning boldly for the future, says Finance Minister
“A Budget that boldly plans the future while at the same time addresses the present day to day concern of the population”. This, in the words of the Minister of Finance and Economic Development, Mr Pravind Jugnauth, is the driving force of the 2016-2017 budget which was presented at the National Assembly on 29 July 2016.
The Minister stressed that the tough challenges ahead compounded by the pressures of global trends and the Brexit event, called for bold action.
“The challenges of tomorrow cannot be met with our mindset, policies and actions locked in the paradigm of yesterday”, he said. Thus the focus in this budget is on a new course that breaks with the past, while also building on, consolidating and modernising the existing setup.
Geared on ushering Mauritius in ‘A New Era of development’, the 2016-2017 budget is framed around ten key strategies meant to draw the economy and the country forward. These strategies are accompanied by a forceful and wide-ranging set of measures for implementation.
The ten Key Strategies
- – Fostering a wave of modern entrepreneurs
- – Creating more job opportunities for all
- – Entering a new economic cycle focusing on innovation, boosting exports and private investments
- – Moving towards a full-fledged digital society
- – Reforming business facilitation and expanding our economic horizons
- – Building the infrastructure that fits into the future
- – Lifting the quality of life for one and all
- – Addressing the root causes of poverty
- – Launching a major public sector reform programme
- – Ensuring macroeconomic stability and sound public finances.
The Budget in Figures
The 2016/17 budget amounts to Rs 117.4 billion, of which Rs 103.3 billion for recurrent expenditure and Rs 14.1 billion for capital expenditure.
Total revenue is estimated at Rs 102.4 billion, of which tax receipts would be Rs 84.7 billion and external grants Rs 6.4 billion. Budget deficit is projected at Rs 15 billion, representing 3.3 percent of the Gross Domestic Product (GDP) against 3.5 percent for 2015/16. A GDP growth rate of 4.1 percent is targeted for 2016/17, while nominal GDP would amount to Rs 451.4 billion.
Revenue Input will be boosted by, among others, an increase in excise duties on alcoholic products (+10%) and tobacco products (+25%), and in customs duty on spirituous products (from 15% to 30%). Moreover, a 2 percent levy will be charged on the net stakes of all gambling operators.
Job creation and Employability – Projected creation of some 20,000 jobs; Enlistment of 4,000 persons and 2000 unemployed under the National Skills Development Programme for training in technical skills in high demand and the Youth Employment Programme respectively; Placement of 200 trainee engineers in public sector bodies; Spending on a modern education system that is more responsive to the aspirations of the young and to the future needs of the economy.
Business facilitation and SMEs
Overhaul of procedures for the delivery of Building and Land Use permits and other clearances, with drastic cuts in processing time; Development of a national e-commerce platform to connect consumers from the rest of the world directly to Mauritian exporters.
Selected measures for SMEs include: Suspension of payment of trade fees for licences of Rs 5 000 and below for SMEs for a period of 3 years; Broadening of the fiscal incentives in terms of tax-holiday; Creation of SME Industrial Parks and of a pilot Agri-Business Park; Improved access to finance.
Rs 1 billion for the construction and completion of 1,900 units of up to 50 metre2 each, on 16 sites across Mauritius; Rs 155 million for the rehabilitation programme of NHDC housing estates; Full exemption from registration duty for acquisition of new house/apartment not exceeding Rs 6m, with no age restriction.
Launch of the Marshall Plan against Poverty geared towards empowering vulnerable families to break away from the poverty cycle and stand on their own feet. Every adult on the Social Register will be entitled to a monthly subsistence allowance based on a minimum threshold of Rs 2,720 with a maximum threshold of Rs 9,520 for a family of two adults and three children. Introduction of a Support to Education programme with cash awards for those students successfully completing the 9-year schooling, the SC and the HSC.
A high level Committee will review the National Pensions system as well as look into ways and means to improve the contributory retirement pension benefits of private sector employees.
Project for a Metro Express, with Indian financial assistance
Major reform of the public sector
Merging of institutions operating in inter-related segments for greater synergy and efficiency and better results.