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Satyendra Pathak
His Highness the Amir of State of Qatar Sheikh Tamim bin Hamad Al Thani on Thursday issued law no 22 of 2020 approving the state’s general budget for the fiscal year 2021.
The law will be effective as of January 1, 2021, and shall be published in the Official Gazette.
Qatar has set a budget of QR194.7 billion for 2021 and the country’s total revenue is expected to reach QR160.1 billion, Minister of Finance HE Ali Shareef Al Emadi said in a statement.
Emadi said the revenue in the 2021 budget is based on a conservative average oil price assumption of $40 per barrel. This reflects a continued policy of conservative revenue estimation to maintain a fiscal balance and minimise the impact of the fluctuation in energy prices on the budget, he said.
As the total expenditure is expected to reach QR194.7 billion during 2021, the minister said, the budget anticipates a deficit of QR34.6 billion.
The Ministry of Finance will cover the projected deficit from available resources or through issuing debt instruments in the domestic and international financial markets if needed, he said.
The minister said an amount of QR72.1 billion has been allocated for major projects in the 2021 budget.
“This includes an allocation for new projects along with on-going development projects in various sectors and those related to hosting the 2022 World Cup. This also includes allocations for citizens’ land development projects and related infrastructure,” he said.
“The state continues to give priority to education and healthcare sectors, whereby allocations for the education sector amounted to QR17.4 billion which includes spending to expand schools and other educational facilities. Allocations for healthcare amounted to QR16.5 billion, covering additional high priority projects to further promote and expand medical and healthcare facilities scheduled to be implemented during 2021,” the minister said.
The 2021 budget focuses on providing the necessary allocations to complete various major projects, as well as those related to the 2022 FIFA World Cup, within the stated schedule.
In addition, it will also focus on enhancing the state food security levels, infrastructure development in the economic, industrial and logistics zones to support the process of economic diversification and growth.
Out of the total projected expenditure of QR194.7 billion 2021, the allocations for ‘salaries and wages’ are estimated at QR57.9 billion, representing a decrease of 1.9 percent compared to QR59 billion in the 2020 budget.
The decline in ‘salaries and wages’ allocations is a result of the reforms that have been taken to deal with the COVID-19 pandemic, as well as the measures taken to enhance the efficiency of public spending.
The ‘Current Expenditure’ allocation is estimated at QR60.7 billion, an increase of 4.7 percent compared to QR58 billion in the 2020 budget. The increase is due to the cost of operating the newly completed projects and the continuation of World Cup projects and programmes.
The allocation for ‘Minor Capex’ is estimated at QR4 billion, compared with QR3.5 billion in the 2020 budget.
The allocations for ‘Major Projects’ is estimated at QR72.1 billion, a decrease of 19.9 percent as compared to QR90 billion in 2020. The decrease is due to the completion of a large number of development projects in various sectors, particularly in the education, healthcare and transportation sectors, in addition to 2022 World Cup completed projects.
The estimated revenue of QR160.1 billion 2021 is down by 24.1 percent compared with QR211 billion in the 2020 Budget which was based on a $55 a barrel price.
For 2021, it is expected that corporate tax revenue will decline as companies performance was adversely impacted by the COVID-19 pandemic.
The share of non-oil revenue in total revenue is estimated to be around 24 percent in the 2021 budget.
It is expected that some initiatives and programmes will contribute to increasing this share in the coming years.Amir approves general state budget
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