Premier and Minister of Finance, Victor Banks.
ANGUILLA--Premier Victor Banks presented Anguilla’s Budget in an address on Wednesday, April 15, with the theme “Building a Dynamic Economy.”
He pointed out that the budget estimate had been presented to the Foreign and Commonwealth Office on March 5 and had been approved by Baroness Sugg, Minister for the Overseas Territories. However the effects of COVID-19 were not known then and the Baroness noted that it had been approved before the potential effects of the virus were known and therefore it would be subject to change. She wrote, “I am aware that you will be tracking the economic and fiscal impact of the virus and will make adjustments as the position, particularly on revenues, becomes apparent. I also know that our teams are already in discussion on these matters.”
Before giving details of expenditure and revenue, Banks said there is a need to address the structural constraints to economic growth and development in Anguilla. “We believe that one of the main constraints is the lack of direct air access to Anguilla. Consequently, rehabilitating and extending the current runway at Clayton J. Lloyd International Airport is a major capital development objective for 2020.
“In order to facilitate this, it requires empowering and enabling the Anguilla Air and Seaports Authority (AASPA) to fulfil its mandate. Consequently, the Executive Council has approved the repeal of the Embarkation Tax Act and the Airline Tax Act and allows AASPA to levy Passenger Facility and Port Development Fees directly under their statute.” He went on to note that the expansion will assist tourism and also facilitate growth and diversification initiatives that the government is pursuing, such as the Special Economic Zone and Residency by Investment. Another plan for diversification is the intention to harness the potential in Anguilla’s 200 mile Extended Fisheries Zone by developing an offshore fishing industry.
The minister reported that 2019 saw an increase in the recurrent revenue estimate by EC $25.74 million that was due in part to the strong performance of the economy in key sectors. The Accommodation Tax was particularly high with revenue showing a 51.3 per cent increase. The recurrent balance was estimated to have a deficit but instead the fiscal year for 2019 ended with a recurrent surplus of EC $21.92 million.
Recurrent expenditure for 2020 is projected to be EC $241.47 million. Banks gave details of how this amount was reached with plans for each of the ministries. He also gave an account of the recurrent revenue expected for the next year.
He said plans for capital expenditure had already had to change with the construction of an isolation unit, purchase of medical and personal protective equipment and investment in teleworking and other creative methods so that the business of the government could continue. “These dynamic responses will protect us, provide relief to our people, keep our economy going, but most importantly, save lives,” he said. The recurrent revenue for 2020 is estimated at EC $253.45 million, but he noted that with the impacts of COVID-19 the anticipated collections may not materialise.
Banks said despite COVID-19, public infrastructure spending would continue and would provide employment opportunities in the construction sector that would enable displaced workforce employees to be reassigned. He said it was expected that revenue collections would shrivel during the lockdown period and could mean losing over EC $100 million in recurrent revenue. He spoke of support for the unemployed and support for businesses to provide crucial financing to get them back on track. Waivers are being instituted to assist businesses and individuals in the payment of taxes and penalties.
Banks noted strongly that the budget does not include any new tax measures. However, he encouraged responsible citizens to make their contribution through compliance with existing measures. “This will demonstrate our pride in contributing to the building of a dynamic economy,” he said.
He concluded by thanking private sector partners like hotels and restaurants, as well as banks, communication providers and agencies including Social Security, Anguilla Electricity Company ANGLEC, the Anguilla Development Board and the Water Corporation for their concessions to the community at this time. He also thanked his staff at the Ministry of Finance and his ministerial colleagues as well as the governor, deputy governor and attorney general for their support in the budgetary approval process. “This has been a team effort all around to ensure that we continue to design the architecture for building a dynamic economy for Anguilla and its people,” he concluded.
