by Linda Straker
- Finance ministry projected earnings of EC$654.6 million, but actual amount was EC$727.7 million
- Government has access to more than EC$210 million in financial support
- Government waiving VAT on building materials and home appliances
Finance Minister Dennis Cornwall disclosed that the Government will delay triggering the escape clause of the Fiscal Resilience Act and instead will use measures to assist in rebuilding Grenada without suspending the fiscal legislation.
“We did say that we were going to consider utilising this measure if need be. So far, we have decided to take our time and, step by step, make sure that we do not just go out there and spend government resources but utilise the measures without having in place the need to do that,” Cornwall told reporters during a news conference on 7 August.
“We have decided on the rules and suspension of targets of the Fiscal Resilience Act,” announced Minister Cornwall during a news conference on Wednesday, 17 July 2024. He said the Cabinet of Ministers decided this would be the correct thing to do in the aftermath of Hurricane Beryl, which devastated the northern part of the country on 1 July.
“Yes, we still have plans to look at those measures because we have access to those measures, if need be,” he said, pointing out that the Government has started announcing measures that will help the citizens affected by the hurricane rebuild their lives.
The finance minister said the Government is forgoing a significant amount of revenue through fiscal measures, which will include waiving of value-added tax (VAT) on building materials and home appliances.
Government has access to more than EC$210 million in financial support, including EC$118 million from the Caribbean Catastrophe Risk Insurance Facility (CCRIF), Grenada’s payout when it triggered a claim because of damage caused by the hurricane. Millions are also available from 2 emergency funds established in accordance with the Public Management Act and the Citizenship by Investment National Transformation Fund regulations, respectively.
“The so-called funds that we have received thus far — and for some people out there, it’s a lot of money — I want to caution that this lot of money syndrome will prove that we still need a lot more money than we have currently to rebuild the state,” said Cornwall who explained that Government cannot run without revenues.
The monthly fiscal report from the Ministry of Finance shows that as of 30 June 2024, revenue to the state has surpassed projected estimates as forecast in the 2024 Estimates of Revenue and Expenditure. The finance ministry projected that Grenada would earn EC$654.6 million, but the actual amount collected was EC$727.7 million.
