Budget Alert 5.6: Implications of a Deficit Budget by Laurel Bain
A surplus budget is generally anticipated. However, fiscal policy dictates that, at some times, the budgets will be in deficit over a cycle. In the 2025 national budget, presented to Parliament on 7 th March 2025, an overall deficit of $337.4M is estimated for 2025. This deficit was influenced by a projected decline in revenue which was combined with higher expenditure when compared with 2024. The factors contributing to the growth in expenditure and the falloff in revenues are not the main subject of analysis in this article, Instead, the article focuses on the implications of the overall fiscal deficit.
This fiscal deficit implies that the Government plans to spend more than it projects to collect in tax and non-tax revenue, and any grants that it may receive during 2025.
