Kuwait’s National Assembly (parliament) approved Wednesday 2020’s budget with an expected $22 billion deficit.
Meanwhile, MPs continue to reject the government plans to impose taxes or cut subsidies on specific items.
Revenues in 2019-2020’s budget were estimated at $53 billion and the expenditure at $74 billion.
The projected deficit is equivalent to 15.7 percent of the country’s GDP.
This is the fifth year in a row that Kuwait’s budget faces a deficit as the collapse of oil prices in 2014 caused a sharp drop in Gulf countries’ revenues.
According to a report by the parliamentary committee on the bill that stipulates linking the ministries and government departments’ budgets for the fiscal year (2019-2020), the revenues are estimated at about KD16 billion (about $53 billion), and KD1.6 billion (about five billion dollars) of revenues are allocated for the Future Generations Fund (FGF) reserves.
While expenditures are estimated at about KD22.5 billion (about $74 billion).
The projected oil revenues are about $45.4 billion, or 88 percent of the total revenue, based on the price of $55 per barrel.
The budget will enter into force on April 1 after it is approved.
The committee’s report said that the increase in expenditure and allocations on income (deficit) is estimated at about KD8.250 billion, which is covered by the state’s general reserve fund.
The budget bill was passed by 36 votes in favor and 20 against. During the debate on the budget, many MPs called on the government to stop squandering public funds and start implementing some reforms.
Head of the budgets committee MP Adnan Abdulsamad warned that the country has been facing major challenges, adding that even if the government imposes taxes and raises charges on public services, it will not be able to solve this issue.
