By Taban Henry
The National Minister of Finance and Planning has on Wednesday tabled a draft budget of 1.3 trillion South Sudanese Pounds as the fiscal year budget for the financial year 2022-2023 at the floor of Parliament.
The presentation of the fiscal year budget to the parliament comes about two months later when the Council of Ministers in early June passed the SSP 1.3 trillion as the draft fiscal budget for the financial year 2022/2023.
Agak Achuil Lual, the national Minister of Finance presented the 2022/2023 fiscal budget draft in its first reading stage to the Reconstituted Transitional National Legislative Assembly yesterday during the national assembly sitting No.10/2022.
In his presentation, the Finance Minister said the projected revenue for the financial year 2022/2023 draft budget amounts to 832.8 billion South Sudanese Pounds (SSP) adding that the proposed spending stands at SSP 1.3 trillion.
He cited that a gap of SSP 560 billion budget deficit will be financed through borrowings and other sources.
“Gross domestic revenues for the fiscal year 2022-2023 are estimated at SSP 832.8 billion. And of this amount SSP 715.7 billion are oil revenues while the remainder of SSP 513.6 billion are non-oil revenues,” he highlighted.
Achuil added that the total oil production is projected at 150,000 barrels per day in the fiscal year 2022/2023, down from 156,000 barrels per day in the fiscal year 2021-2022 citing that the projected reduction of six thousand barrels a day in oil production is due to depletion of some oil wells as well as the effects of flood experienced in 2021.
He stated that the government share in the oil production is forty-four percent while the benchmark prices for Dar Blend is estimated at US$ 75 per barrel.
“Out of the gross oil revenues of SSP 715.7 billion, the government has provided for direct transfers or mandatory payments of SSP 545.3 billion out of which, SSP 92 million in tariffs is direct transfers to Sudan. Transfers to the oil producing States/Administrative areas 2% SSP 12.5% billion, to the communities 3% SSP 18.7% billion and transfers to the Ministry of Petroleum 3% of SSP 18.7 billion other mandatory direct transfers are: oil for roads projects of SSP 238.2 billion, Future Generation Fund (FGF) 10% SSP 62.4 billion, oil revenue stabilization account (ORSA) 15% SSP 93.6 billion and National Revenue Authority operation 8% SSP 9.4 billion,” Achuil elaborated.
The Finance Minister hinted that non-oil revenues are predicted at SSP 117 billion in fiscal year 2022-2023, an increase of 58.8% billion adding that the projected increase in non-oil revenues is an account of the tax administration reforms taken by the National Revenue Authority which includes digitalization of tax collections, broadening the tax base and the proposal to fully deploy National Revenue Authority staff in all the non-tax revenue collecting institutions.
“We have proposed some adjustment in the fees structures for some of the non-oil revenue categories. These proposals are included in the financial Bill for the year 2022-2023. It is essential therefore for the august house to passes the financial Bill alongside the Budget, so that we have a legal basis for our revenue estimates,” Minister Achuil submitted.
He however pointed out that the 2022/2023 budget has been prepared in a challenging environment of generalized rise in the global prices of goods and services.
He said the rise has two effects on our economy, first of all is a positive impact on our oil revenues, which could enhance fiscal space and reform efforts toward the establishment of a robust public financial management system, secondly is a negative impact on our economy of the global rise in goods band services and which is likely to offset gains arising from the increase in oil revenues.