The Minister of Finance, José Manuel-Jochi-Vicente, recognized that capital expenditure is little, but it is what can be done for the time being, because otherwise the fiscal deficit would have to be increased and indebtedness increased, which, for the next year, it will be 3% of gross domestic product (GDP).
The capital expenditure contemplated in the General State Budget project for 2023 is RD$155,175 million, while the current expenditure would be RD$1 billion, 092,403.1 million.
The official explained that priorities have been established for an amount of RD$187.486 million, which include the construction of a Monorail and a Cable Car in Santiago, in the Santo Domingo Cable Car, in the Monte Grande Dam, for which RD$2.086 million will be allocated. ; and Line C of the Santo Domingo Metro.
Other priority investments include salary increases for the Police and the Armed Forces, police reform, electricity and fuel subsidies, Supérate, gas bonus, family bonus, high-cost medicines, happy housing, 9-1-1 system, among others. . In addition to investments in specific regional projects. In the Cibao Noroeste region, RD$7,584.9 million will be allocated, in Cibao Norte RD$28,415.8 million, Cibao Nordeste RD$3,072.7 million, Cibao Sur RD$1,363.1 million and in El Valle RD$1,639.9 million.
Higuamo contemplates RD$1,697.4 million, Yuma RD$1,200.8 million, Valdesia RD$5,139 million, Ozama RD$31,599.7 million and the Enriquillo region, which includes the province of Pedernales RD$4,916.6 million.
Vicente indicated that it is not possible to make reforms in times of crisis, regarding the fact that the fiscal pressure still does not reach the projections contemplated in Law 1-12, of the National Development Strategy, nor has article 36 of the legislation been applied, in order to meet the goals of axis 3.25 of increasing the country’s tax pressure. That point is pending to consolidate public finances, according to the General State Budget project.
Article 36 of Law 1-12 of the END raises the need for a Fiscal Pact, while axis 3.25 of the legislation indicates the search for sustained growth with equity through productive capacities, entrepreneurs of the population and the generation of decent job.
Vicente was accompanied by deputy ministers María José Martínez and Camila Hernández yesterday at the Treasury headquarters, with Economy editors from the country’s main print media, in order to explain the decisions on income and expenditure policies, financing and social protection contemplated for 2023. The 2023 budget project indicates that the average tax pressure of the DR was 14.3%, surpassing Costa Rica (13.8%) and Guatemala (11.5%), during 2010-2022. While 17 Latin American countries it was an average of 24.%.
At some point, Vicente said, the Dominican tax system will have to be modified to meet investments in infrastructure, food security, social security and other services. The total income of the central government would amount to RD$1,040,005.5 million next year, equivalent to 15.1% of the GDP estimated for 2023, and the total expenses would be RD$1,247,578.1 million, for a deficit of 3%.
The budget for this year 2022 will close at RD$1 billion 163,392.5. The Minister of Finance indicated that the budget must be seen in an integral way, since it obeys global decisions.
The subsidy for electricity will be RD$70.425 million and for fuels RD$20.000 million.
Among the expenses established by law in the annual budget, there is also 4% for education, for more than RD$275,000 million; debt interest for RD$22,000 million and the funds to capitalize the Central Bank.
An oil price of around US$90 per barrel was estimated, although the country buys derivatives to a greater extent, which, in the case of natural gas, has risen from US$2.5 to US$3.5 per million BTU and is between US$7 and US$8 and coal has gone from US$90 to more than US$400.