WILLEMSTAD - The Financial Supervision Council believes that the government of Curacao should focus more on reducing spending and less on increasing income.

“The explanatory notes to the budget estimate show that positive developments in tourism are expected, that shutting down the refinery will no longer have a major effect in 2020 and that measures taken by the government in the context of the designation will have a negative effect on consumer spending. The increase in excise duties and the introduction of the ABB will lead to rising inflation in 2019 and 2020, "said the Cft in response to the adjusted budget for the current year.

“It is therefore advisable to place greater emphasis in future budgets on spending-restricting measures. In the explanatory memorandum, the government mentions a number of risks in the budget estimate, such as the multi-year effect of the closure of the refinery, an exacerbation of the refugee problem from Venezuela and the uncertain effect of the intended increase in tax revenues."

The adjusted budget for this year is conclusive, but according to the Cft does not comply with the budgetary instruction that the Rhuggenaath Cabinet received from the Kingdom Council of Ministers in July. The Cft states that there is insufficient compensation for the deficits from 2017 and 2018 (175.3 million guilders). “The draft budget compensates for only ANG 117.7 million in deficits over the period described in the instruction. Curacao needs to adjust the sales tax (OB) to comply with the instruction,” says the Cft.