Overall government revenue collections dropped by 7% in FY 2019 according to the FY 2019 4th quarter report from the Ministry of Finance. Revenue was projected to reach $65 million but only $60million was collected. The overall local revenue includes taxes and fees such as gross receipt tax, wages tax, hotel room tax, alcohol & tobacco tax, PPEF, fish export, fuel excise tax, permit fees, and licenses among others.
Local taxesshowed a much sharper decline of13% compared to projected amount. These include fish export tax, fuel excise tax, gross receipts, income taxes, hotel room tax, import tax, alcohol & tobacco tax, PPEF and other taxes. Gross receipts dropped by 11%, hotel room tax by 27%, alcohol & tobacco by 16%, and fuel excise tax by 19%. This shows lesser spending driven in most part by fewer tourists.
President Remengesau Jr. at the November 27th press conference confirmed that the overall governmental revenue collections dropped due to reduction in tourist arrivals.
“Yes, total revenue dropped due to number of visitors going down, especially visitors from China but we had a balanced budget due to cost cutting measures,” stated Remengesau.Remengesau said the administration kept the expenditures at 10% below the budget.
The ROP 4th Quarter Financial Reports showed $95.7 million authorized and appropriated for expenditure but only $86.4 expended or 90% of budget expended.