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Despite a reduction in the growth forecast by the IMF, the government is not revising the budget

16.04.21 17:30

The Georgian government will not revise the parameters of the 2021 budget - Minister of Finance Lasha Khutsishvili told BMG. This is despite the fact that last week the International Monetary Fund reduced Georgia's economic growth forecast from 4.3% to 3.5%. At the same time, the IMF said in a document published on April 12 that in the event of an increased pandemic crisis in Georgia, the government will have to reconsider its budget priorities.
The 2021 budget is projected by the government for 4.3% economic growth. If the economic activity in the country will be lower, the fulfillment of the tax part of the budget may be endangered. However, the Minister of Finance Lasha Khutsishvili states that so far there is no threat to the budget execution.
"The IMF estimates the expected results of economic growth, in this case 3.5 percent - it depends only on the expectation of how the tourism sector will recover this year. This assessment of the IMF, I am sure, will change over the year and I hope it will be positively reviewed. The situation is very dynamic and rapidly changing and I understand that it is very difficult for them to make predictions. Such was the case last year, when expectations were repeatedly changed.
The budget does not need to be adjusted in this direction because the budget process is not something that can be changed one month and rebuilt in another month. We are observing the parameters. Today, there is no sign that the execution of the budget can be endangered. On the contrary, we have more expectations. We do not plan any kind of change yet, "Lasha Khutsishvili said.
The tax revenues of the 2021 budget are set at 10.34 billion GEL. Of this, the forecasted volume of VAT is 4.34 billion, the excise tax is 1.58 billion, the projected volume of profit tax is 951 million GEL, and the volume of income tax is 3.31 billion GEL.
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