The Minister of Finance, Jochi Vicente, reported the fiscal results for the first quarter of 2023, citing four of the most relevant aspects in the aforementioned period, which are: tax revenue registered an increase of 12.1% in relation to the same period of the previous year and 3% in relation to the budget and the Government’s decision to advance the payment of all current transfers for the recapitalization of the central bank that were budgeted for the current year.
In addition to the maintenance of grant programs that have a significant impact on the mitigation of the inflation and an acceleration of the execution of capital spending in relation to the previous year as a way of compensating for the decrease in the rate of economic growth as a result of the restrictive monetary policy.
The head of public finances pointed out that 58.2% of the increase in current expenditure in the first quarter of this year is due to the transfers that have been made to public sector institutions.
It reported that “transfers to the Central Bank for recapitalization were fully accrued. This is a measure that demonstrates the central government’s commitment to the recapitalization of the monetary entity”.
On the other hand, he highlighted that there is an increase in the transfers required by the electricity distribution companies as a consequence of the high prices of oil and natural gas that have a negative impact on the finances of the distribution companies. “The EDES are experiencing an increase in the cost of acquiring the energy they sell at a time when, by decision of the Government, no adjustment to the electricity rate is being made,” he said.
Total expenses in the first quarter of 2023 amounted to RD$301,454.4 million, varying by 27.7% compared to 2022 and representing 4.3% of the gross domestic product (GDP). Meanwhile, current expenses totaled RD$272,813.4 million, equivalent to an increase of 25.9% compared to the same period in 2022.
Meanwhile, at the budget level, capital spending for the first quarter of 2023 is equivalent to RD$28,641.0 million (0.4% of GDP), showing an interannual variation of 48.5%.
Capital transfers increased by RD$4,319.8 million compared to the first quarter of 2022, explained by the transfers of:
a) RD$2.5 billion for the construction of the Santiago monorail, which is carried out through the Trust for the Development of the Mass Transportation System of the Dominican Republic (FITRAM); and
b) RD$1,417 million destined to the construction of houses of the MIVIVIENDA Public Administration Trust.
In addition, the minister assured that the Government continues to protect the population from the effects of imported inflation, assigning more funds to the expansion of the Supérate program, avoiding the rise in the prices of food, fuel, fertilizers and other elements of the basic basket Dominican.
Jochi Vicente explained that these measures caused the deficit for the first quarter to stand at 0.8% of GDP, which represents a difference of 0.5 percentage points of estimated GDP compared to the first quarter of 2022. However, of this increase, 0.3 % of GDP corresponds to the decision to advance the items related to the recapitalization of the Central Bank.
Total revenue
Minister Vicente explained that the total income of the Central Administration closed the first quarter of 2023 above what was budgeted, accumulating RD$246,846.2 million, showing an execution of 103.0% compared to the General State Budget 2023 (PGE). This figure increased by 12.1% compared to the previous year.
He pointed out that the increase in collections from the General Directorate of Internal Taxes (DGII) and the National Treasury (TN) offset the reduction in income from the General Directorate of Customs (DGA).