Economic and Financial Review - June 2019

June 2019 Economic and Financial Review SAINT LUCIA

$98.5m realised in the corresponding period of the previous year.

reflecting increases in collection of arrears ($6.5m) and revenue intake from personal income taxes ($4.4m). A decline of $4.1m in receipts from withholdings taxes mitigated the overall increase in this tax category. Revenues from taxes on domestic goods and services marginally increased by 0.5 per cent ($1.0m) over the review period, with gains in the value added tax ($3.1m) being somewhat offset by a decline in license fees ($2.4m). In contrast to the other major revenue line items, receipts from property taxes declined by 29.7 per cent ($1.8m) over the first six months of 2019. Current expenditure grew by 5.7 per cent to $570.9m, primarily driven by larger outlays for personal emoluments, with smaller increases recorded for interest payments and transfers and subsidies. Personal emoluments rose by 16.4 per cent to $225.6m, with salary payments increasing by 20.0 per cent, tempered by a 9.6 per cent decline in wages. Interest payments also grew by 4.3 per cent to $83.7m, mainly attributable to an 11.5 per cent increase in domestic interest payments, which were partially offset by a 4.1 per cent decline in external flows. Current expenditure was also positively influenced by larger outlays for transfers and subsidies which rose by

A surplus of $45.2m was recorded on the current account in the first half of 2019, compared with one of $74.5m in the corresponding period of the prior year. The smaller surplus was primarily attributable to the slower growth in current revenue relative to current expenditure. Current revenue increased by 0.3 per cent to $616.2m, compared with growth of 12.3 per cent to $614.4m one year earlier. The half-year outturn for 2019 was driven by an increase in tax collections, which offset the decline in non-tax receipts. Revenue from taxes grew by 1.7 per cent, as improvements were recorded in all the major tax categories, except property tax. Tax receipts on international trade and transactions grew by 3.0 per cent ($5.2m), largely influenced by the increase in excise tax collections ($12.9m). However, this improvement was partly offset by a decline in receipts associated with the airport tax ($6.0m) and import duty ($1.1m). Marginal declines in flows were also recorded for the service charge, throughput charges and the travel tax. Proceeds from taxes on income and profits grew by 3.0 per cent ($4.8m),

85

Eastern Caribbean Central Bank