Revenue, expenditure inconsistent with IMF targets
View(s):The government’s revenue and expenditure estimates for 2024 are inconsistent with the International Monetary Fund’s stipulated targets apparently raising risks around its US$.2.9 billion extended fund facility programme, several fiscal analysts warned.
According to IMF Memorandum of Economic and Financial Policies, the Finance Ministry will have to abide by the targets set by the fund to achieve revenue-based consolidation.
But 2024 budget estimates on revenue and expenditure are very much different than the IMF assessments, ministry and IMF data indicated.
The Budget 2024 revenue estimate of Rs. 4127 billion was Rs. 336 billion less than the IMF assessment of Rs. 4463 billion.
The expenditure estimate for 2024 was Rs. 6,978 billion, Rs.402 billion more than the IMF assessment of Rs.6,594 billion.
The IMF has made these assessments based on finance ministry data and they will raise queries on these discrepancies, a well-known financial analyst said adding that IMF will not accept official revenue and expenditure figures. He said that the ministry has made a strong effort on a revenue-based consolidation.
But expenditures are significantly higher than revenue, and so, there should be a balance in budgetary estimates, he pointed out.
IMF supports the authorities in adjusting their policies to correct fiscal imbalances and it provides some financing that cushions this adjustment. IMF sources said.
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