AMMAN – The Jordanian government on Wednesday approved the draft public budget law for the fiscal year 2024, which will now be referred to the parliament. The Minister of Finance, Muhammad Issis, highlighted that the budget, which avoids any increase in taxes or fees, features the highest capital expenditure in the nation’s history.
According to Jordan News Agency, this budget marks the fourth consecutive year without a tax rise. It also aligns with the government’s royal directives aimed at enhancing progress in implementing Jordan’s economic modernization vision. The national economy is projected to experience real growth of approximately 2.6 per cent and nominal growth of 5.1 per cent in 2024. The budget anticipates maintaining moderate inflation rates, among the lowest globally. When drafting the budget, the government took into account the slowdown in global growth due to anti-inflationary efforts and unspecified regional developments.
Issis also noted that the budget includes increased financial allocations for social protection. Additionally, it earmarks funds to support the Jordanian armed forces and security services. The draft law forecasts public revenues of about JOD10.3 billion, an 8.9 per cent increase from 2023, with local revenues expected to rise to JOD9.6 billion. This increase is attributed to a 10.2 per cent rise in tax revenues, reaching JOD7.2 billion, without the imposition of new taxes. The government’s strategy includes expanding the tax base, combating tax evasion, and improving tax administration, which is expected to boost income tax revenues by 20 per cent.
External grants are projected to reach JOD724 million. The draft budget law allocates funds to support strategic food commodities and gas cylinders, alongside increasing national aid allocations to support more eligible families. The law also accounts for larger allocations for public debt, which has risen due to global interest rate hikes.
The estimated current expenditures stand at JOD10.6 billion, with capital expenditures at JOD1.7 billion, totaling JOD12.37 billion in public spending. Capital expenditures have increased by about 11.8 per cent from 2023 to JOD1.729 billion. Allocations for the economic modernisation vision and public sector modernisation map constitute 20.2 per cent of these expenditures. Military and security services projects account for 16.9 per cent, municipal development programmes and decentralisation projects 18 per cent, and the remaining projects comprise 45 per cent of total capital expenditures.
The draft budget aims to reduce the primary deficit for the fourth year in a row, with a target of JOD812 million, or 2.1 per cent of GDP, compared to 2.6 per cent in 2023. The total public debt, excluding the debts of the Social Security Investment Fund, is expected to decline to 88.3 per cent of GDP, with a further reduction to 85.7 per cent by 2026.