Senate okays draft state budget without changes

AMMAN — The Senate on Sunday endorsed the 2021 draft state budget and the bill governing the budgets of independent government units with no changes to the version referred from the Lower House.

In a session headed by Senate President Faisal Al Fayez, and in the presence of Prime Minister and Minister of Defence Bisher Al Khasawneh, Rapporteur of the Senate's Financial and Economic Committee Mustafa Barari reviewed the panel's report and recommendations on the two bills, the Jordan News Agency, Petra, reported.

Barari highlighted proposals to accelerate the Kingdom’s economic recovery, by mainly developing a long-term strategy to manage public debt.

Considered a reference for future economic programmes and government decisions, the said strategy will include discussing reducing interest on loans provided to Jordan by international organisations and lending countries to alleviate the burden of financing costs in light of the challenges posed by spread of the coronavirus.

Replying to senators' remarks, Finance Minister Mohamad Al-Ississ said that the government agrees with the committee's report on the importance of stable reform programmes that control government expenditures.

Al-Ississ also referred to a newly established programme, approved by the International Monetary Fund that bolsters economic growth and decreases unemployment.

He noted that the government will not raise taxes, but shall enhance the collection of already imposed taxes to increase local revenues, adding that the primary deficit is expected to fall from 5.7 per cent of GDP in 2020 to about 3.7 per cent in 2021.

In the 2021 budget, the government plans on increasing capital expenditure by 24 per cent, he noted.

He emphasised that one fiscal year's budgeting would not suffice to remedy the current economic situation.

Although it is currently impossible to decrease indirectly imposed taxes such as sales taxes, which make up 70 per cent of Treasury revenues, the government seeks to enhance service and increase wages, the minister said.