Asharqia Chamber: The new budget confirms the solidity and durability of the national economy in the face of external shocks and unexpected crises
Asharqia Chamber, during its analytical study on the new budget, which was issued on Wednesday, December 16, 2020, entitled (Analysis of the overall performance of the Kingdom's budget indicators for the fiscal year 2021), that the next year's budget confirms the solidity and durability of the national economy in the face of external shocks and unexpected crises, as well as continuity The march to diversify and develop non-oil revenues to ensure the sustainability of public revenues.
According to the study, the budget bears with it many indications of the extent of the wise leadership's interest in achieving the goals and ambitions of Vision 2030, promoting economic growth and maintaining macroeconomic stability in light of the challenge of the spread of the new Coronavirus (COVID-19), which the global economy suffers from its repercussions, while continuing Executing national transformation plans, diversifying sources of income and building reserves, attracting foreign investments, expanding and developing infrastructure projects for the Saudi economy, developing and developing the human element, and giving priority to services that directly affect the Saudi citizen.
The study, which came in six main axes, confirmed that the Kingdom has a strong financial position, given the size of its large reserves with relatively low government debts, which enabled it to face the repercussions of the pandemic despite its great financial and economic effects, which was confirmed by the rating agencies. Credit for the strength and durability of the Saudi economy and its ability to face the crises that the world is currently witnessing.
The study indicated that the new budget revealed the great importance the government attaches to comprehensive development in both its economic and social aspects and what this requires in terms of programming spending priorities to direct it to basic services and to improving the quality of life and raising the standard of living for citizens, in addition to completing the development of vision investigation and development programs. Noting that the education, health, and social development sectors have captured 36.5% of the total public spending allocations in the 2021 budget.
The study showed that the Kingdom worked during the pandemic crisis to continue diversifying and developing non-oil revenues to ensure the sustainability and stability of revenues as a regular source of state resources, through initiatives that contributed to providing resources to implement economic transformation plans, finance expenditures with a social dimension and reduce their vulnerability to fluctuations in Oil markets.
The study said that the budget estimates total revenues in 2021 at about 849 billion riyals, an increase of 10.3% than what is expected to be achieved in 2020, and it is expected that total revenues will continue to grow until it reaches 928 billion riyals in 2023, indicating that it is estimated that revenues from taxes will arrive in In 2021, to about 257 billion riyals, an increase of 30.8% compared to the expected collection in 2020, as a result of the financial impact of the whole year of raising the value-added tax rate to 15% and the increase in customs duties for a number of goods, in addition to the expected economic recovery in 2021.
The study indicated that the total spending in the 2021 budget was estimated at 990 billion riyals, down from the projected for 2020 by 7.3%, which constitutes 34.5% of the gross domestic product, with the continued increase in the efficiency of spending, and confirmed that the government spending estimates indicate that We need to continue implementing social protection programs and other social security programs while continuing to review and improve them in order to reach the target groups. Considering that social spending is one of the most important priorities of government spending to improve the quality of life and raise the standard of living for citizens, including families and individuals.