2015 Neo Kingston Budget

The 2015 Neo Kingston budget was delivered on 13 January 2015 by James Huertos, Minister of Finance and Planning, to the House of Representatives. It was the sixth budget of the Premiership of Zachary Munro, the second of the People's National Party-Green Party coalition government and the second presented by Huertos. The main measures of the budget included an increase in the income tax threshold, the introduction of an automobile scrappage allowance to stimulate the industry, a minor reorganization and simplification of income tax brackets including a reduction in the maximum income tax rate from 55.5% to 55.0% and the introduction of additional levies on imports from certain nations which Neo Kingston is hostile with. An elimination of provisional tax breaks on inheritances and an introduction of an additional tax credit for families where both spouses are employed are also measured outlined in the budget.

Revenues were budgeted at $6,999,994,607,604.27 (37.8% of GDP), an increase of $57,774,892,463.09 over 2014 but down from 39.1% of GDP. This represents the second budget in a row in which revenues are increasing nominally but decreasing as a percentage of GDP.

Expenditures were budgeted at $7,018,513,111,857.19 (37.9% of GDP), down $65,746,904,361.04 from 2014's budget and down from 39.9% of GDP. This is the lowest budgeted expenditure figure as a percentage of GDP since 2008.

The government had long been expected to eliminate the budget deficit and return the nation to a surplus with this budget but had failed to do so. Nonetheless, the nominal deficit shrank to $18,518,504,252.92 or just 0.1% of GDP. This is down from a deficit of $142,040,301,077.06 (0.8% of GDP) in 2013. While admitting that weaker than expected economic performance in 2014 had prevented the long discussed return to surplus, Huertos described the budget as "essentially balanced" due to the small deficit. Both nominally and compared to the nation's GDP this is the smallest deficit since the pre-recession budget of 2008 which saw a surplus of 2.1% of GDP.

Economic projections

Economic growth in 2015 is projected by the government to be in the range of 3.0% to 4.0%, down from 4.1% in 2014 and 7.2% in 2013. Inflation is projected to be around 2.5%, the government's target rate, down from 3% in 2014 and 3.8% in 2013. GDP per capita is expected to move north of $50,000 for the first time in Neo Kingston history while the rate of unemployment is expected to remain stable at around 5.9%.