- The Department of Finance warns that lowering the VAT rate would severely reduce government revenue, threatening funding for essential services and possibly increasing borrowing.
- Current VAT collections are only enough to cover nine months of government payroll and pensions, while excise tax collections fall short of education budget needs.
- The national government’s debt is already above the programmed ceiling and is projected to rise further in 2026.
- The government must generate significant daily revenues and address a daily deficit to sustain expenditures, requiring tax revenues to grow by 10.2% annually.
- Reducing VAT could lower the country’s credit rating, increase interest payments, and worsen the government’s debt situation.
Source: msn.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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