Next year’s budget is being discussed, the current budget is being revised

Next year’s budget is being discussed, the current budget is being revised
The government is holding debates in Parliament about next year’s budget, but, in the meantime, it is still amending this year’s budget. This is what’s happening with the most important documents of the state finances. Meanwhile, financial experts do not offer any assurances as to the extent that budgets will be in line with projections. It was the minister of Economy and Finance, Arben Ahmetaj who declared yesterday, during the debate taking place on the 2018 budget in the parliamentary financial committee, that this budget could be associated with risks. According to him, the risk amounts up to 1.5 billion lek and the reasons for this could relate to excise and currency exchange rates.

“As far as revenues are concerned, fiscal risks could stem from the fact that the amount of imported cigarettes could be 200 tons lower than projected and this could have a financial effect of 0.5 billion lek”, was a concrete example that he gave about the possibility of failing to collect projected revenues during next year. But, opposition MPs have rejected this. According to them, the government is not making a real projection of incomes, because tax burden for people has changed throughout the years. “In comparison to 2013, revenues are supposed to have increased by 3%. But what has happened during these four years? Tax burden has also increased by 3%. So, the government will collect the same amount of money it collected four years ago”, said the democrat MP, Jorida Tabaku.

The normative act, how did the government change the 2017 budget again

What stands out in the revised 2018 Budget is the fact that the government has intervened in the public administration. In other words, the government has made changed in the process of the structural reorganization of the ministries and the most important national departments and this has led to a reduction of the number of employees. Based on the new calculations of the 2017 Budget, public administration will have 81.465 employees as opposed to 81.718 employees that it currently has. This means that the government has reduced this number by 253. Meanwhile, the government is also planning to allocate funds for 100 employees which will be employed in the judicial institutions and 25 others in the central government institutions. The first on the list with the highest number of employees is the Ministry of Education with 31.067, followed by the Ministry of Interior with 14.269, to continue with the Ministry of Defence with 8.860 employees or the ministry of Finance and Economy, which will have 5.708 employees.

The budget is revised almost every summer

The revision of the state budget through a normative act during the summer, has become quite common now. This has also happened last year, when on 31 July, the government published in the Official Bulletin a normative act for the revision of the budget. The minister of Economy and Finance, Arben Ahmetaj has responded to the accusations that the opposition addressed at that time by saying that this practice is not a violation of the Constitution or the laws of the country. According to him, this was a “routine amendment” made with “an instrument which has been used for years”. This means that the government is legally able to intervene in the state budget and that it’s necessary to do this every six months. Meanwhile, this year, this was something that occurred twice.

Budget 2017, revenues and expenses increase, deficit remains the same

An increase of revenues and expenses, but the deficit remains the same. These are the new changes that will be made in the 2017 Budget with the most recent normative act. The budget is also stipulating a reduction of expenses for local government and an increase of expenses for social entitlements and state guarantees. “The budget for 2017 is: Revenues will be 442.901 million lek, they increase by 4.5 billion lek; Expenses amount to 474.100 million lek, they increase by 4.5 billion lek; Deficit is 31.199 million lek, it remains unchanged”, the government’s normative act says, adding that the budget for the central government is: 336.801 million lek in revenues and 368.000 million lek in expenses, with a deficit of 31.199 million lek.

Debate on progressive tax, Ahmetaj: Few people will be taxed, DP: Taxes are increasing

“The progressive tax system has worked out just fine and it has brought tax reliefs for 97% of people working in Albania”. This is how the minister of Economy and Finance, Arben Ahmetaj has commented the most recent incentive of the government to apply the progressive tax on all types of incomes that an individual may have. According to him, the 23% progressive tax is currently apply for only 1500 people in the country, as these people are paid over 400 thousand lek a month. But, the democrat MP, Jorida Tabaku was against this incentive, saying that the government is impoverishing the middle class and that by increasing the tax burden, it will also increase tax evasion. “The government is trying to come up with new ways on how to increase revenues by increasing taxes”, she said.


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