Home Politics Guyana unveils record $1.38 trillion budget with $90 billion in relief measures

Guyana unveils record $1.38 trillion budget with $90 billion in relief measures

0
Finance Minister Dr. Ashni Singh during the presentation of the 2025 National Budget (Photo: News Room/ January 17, 2025)

Already attracting commendations from wide and far, Guyana unveiled its largest fiscal framework yet, a monumental $1.38 trillion budget for 2025 on Friday.

Anchoring this vast financial blueprint is a sweeping $90 billion package of relief measures designed to alleviate the cost of living and put more money in the pockets of the nation’s citizens.

Dr Ashni Singh, Senior Minister responsible for Finance and the Public Service, presented the national budget, which he boasts is centred around key initiatives aimed at supporting the most vulnerable and boosting disposable income across the country.

The measures are seen as a direct response to the growing financial pressures felt by ordinary Guyanese as well as a fulfilment of several campaign promises made by the ruling People’s Progressive Party/Civics (PPP/C).

An elderly resident of Region Seven examines his new pair of spectacles

Support for the vulnerable 

The budget contains a series of targeted initiatives designed to provide immediate relief for vulnerable groups, including pensioners, families, and individuals with disabilities.

A key highlight is the increase in old-age pensions, which will rise to $41,000—a fulfilment of a promise made in the party’s 2020-2025 manifesto. This single measure alone will inject a significant $4.5 billion annually into the hands of thousands of pensioners, a crucial boost to those who depend on these funds for daily living.

Similarly, public assistance for persons living with disabilities is set to rise from $19,000 to $22,000, pumping an extra $1.4 billion into the pockets of those most in need. For families, the popular ‘Because We Care’ cash grant will see an increase to $50,000 per child, benefiting more than 200,000 schoolchildren, public and private school alike.

With an additional $5,000 for school uniforms, the total government support for families with school-age children will amount to a generous $55,000.

Perhaps one of the most thoughtful measures is the introduction of a $10,000 universal health voucher for every Guyanese, ensuring that all citizens have access to regular health check-ups and medical care.

Furthermore, new mothers will receive a one-off cash grant of $100,000, providing essential financial support as they care for their newborns.

Current prices for fruits and vegetables at the Bourda Market in Georgetown

Easing the burden of rising costs

The government has also dedicated $9 billion to mitigate the impact of the ever-increasing cost of living. This massive intervention stems from extensive consultations with stakeholders, reflecting the government’s intent to tailor its fiscal response to the unique needs of the population.

For workers, the government has introduced a series of tax reforms that will leave many with significantly more disposable income.

A key reform is the increase in the income tax threshold to $130,000 per month. This will immediately reduce the tax burden on workers, putting an extra $8.5 billion into the hands of 22,000 individuals who will be removed from the tax roll entirely.

Additionally, the rate of Pay As You Earn (PAYE) tax will be reduced from 28% to 25%, ensuring that more of workers’ earnings are retained.

For those who are eligible for National Insurance Scheme (NIS) pensions but have not met the required contribution levels, the government has earmarked a substantial $10 billion to provide much-needed support.

Hundreds of attendees at the job fair

Job creation and skills development 

In a bid to further enhance household income and employability, the government is extending its part-time jobs initiative, which aims to provide immediate income while helping individuals develop the skills required for full-time employment.

This initiative, costing the state $11 billion, will offer opportunities for personal growth and financial stability.

The rice

Agri sector growth 

Recognising the importance of agriculture to Guyana’s economy, the budget includes measures to support farmers. The removal of VAT on agricultural machinery and backup generators will save the state over $1 billion annually and provide much-needed relief for the sector.

Poultry farmers will also benefit from a new tax policy that shortens the depreciation period for capital assets, helping them to offset costs more quickly and increase production.

Additionally, VAT will be removed on electricity generators, which will benefit business owners, particularly in rural areas, by reducing their overhead costs.

Education Minister Priya Manickchand [third from right], University of Guyana’s Vice Chancellor, Paloma Mohammed-Martin [third from left] and Health Minister Frank Anthony [second from right] along with other officials at the sod turning ceremony on Friday. (Photo: News Room/November 24, 2023)
Free education 

In a move that highlights the government’s long-term commitment to education, Dr Singh announced a monumental $13.1 billion investment into the University of Guyana (UG). This funding will directly support the free tertiary education initiative, benefiting over 11,000 current students and countless new enrollees. The move is part of the government’s broader plan to make higher education accessible to all, without the burden of crippling tuition fees.

The $100, 000 cash grant 

The distribution of the $100,000 cash grant continues in 2025, with an additional $30 billion allocated to extend this initiative. When completed, the government will have placed a staggering $60 billion into the hands of citizens, providing them with a financial cushion in these uncertain times.

Tax reforms 

In an effort to further ease the tax burden on Guyanese workers, the government has introduced several key reforms. Starting in 2025, overtime pay will no longer be taxed up to $50,000 per month, allowing workers to keep more of their hard-earned money. ‘

Similarly, individuals with second jobs will see the first $50,000 of their income exempt from tax, providing a much-needed boost to those juggling multiple sources of income.

The government has also committed to slashing electricity costs by 50% once the gas-to-energy project is completed, further reducing the financial strain on households and businesses. Additionally, tolls will be abolished at the new Demerara River Bridge, as well as the Berbice and Wismar-McKenzie bridges, once the construction is complete, saving commuters a significant amount each month.

Guyanese currency

Vison for the future 

With a bold $90 billion in relief measures, the 2025 budget is a clear signal of the government’s commitment to improving the economic well-being of every Guyanese.

From increased pensions and health vouchers to tax breaks and free education, these measures are designed to offer immediate relief while investing in the nation’s future.

As Guyana continues its rapid economic expansion, this budget reflects a thoughtful balance between addressing the pressing needs of today and building a foundation for sustained growth in the years to come.

Advertisement
_____

LEAVE A REPLY

Please enter your comment!
Please enter your name here