Trinidad and Tobago 2025 Budget Overview

  • On September 30, 2024, the Honourable Colm Imbert, Trinidad and Tobago’s (T&T’s) Minister of Finance, delivered his tenth National Budget presentation under the theme “Steadfast and Resolute: Forging Pathways to Prosperity”.
  • T&T’s projected deficit of TTD5.52Bn continues to be a concern given the still heavy reliance on its energy sector. However, the T&T economy grew by 1.3% in 2023 and 1.9% in 2024. These are promising signs despite a contraction of the energy sector and geopolitical tension, which directly impact local and international trade.
  • With revenue projected at TTD54.224Bn and expenditures at TTD59.74Bn, the budget deficit will be TTD5.52Bn based on an oil price assumption of US$77.80 per barrel, a natural gas price assumption of US$3.59 per MMBtu and anticipated oil revenue of TTD14.17Bn.
  • Some takeaways from the budget presentation include investments in Health (TTD7.57Bn), followed by education (TTD7.51Bn) and national security (TTD6.11Bn). Additionally, the minimum wage for public sector employees is set to be increased by 9.8% from TTD20.50 to TTD22.50, following a 17.0% increase in January 2024.
  • The budget contemplates the phased rollout of property taxes after the suspension of the Land and Building Tax Regime in 2010 and the granting of a Tax and National Insurance (NIS) Amnesty, allowing taxpayers to regularise outstanding tax obligations and ensure compliance. Other takeaways from the budget include plans to issue interest-bearing VAT bonds to alleviate the significant backlog of VAT refunds owed to businesses, and tax-exempting electric vehicle charging equipment and sporting equipment.
  • Given the paucity of its proven energy reserves, T&T needs to diversify the economy away from the energy sector. The Minister highlighted diversifying initiatives like expanding trade agreement networks and granting further incentives to propel the agricultural, tourism, manufacturing and other sectors.
  • That said, the government continues to rely heavily on the energy sector, despite acknowledging the need to insulate T&T from the volatility of energy sector revenue contributions.
  • Overall, the Government is faced with the unenviable task of maintaining economic stability by focusing on, among other things, infrastructural development, security and diversification, while addressing current vulnerabilities.

(Source: PWC)