MUSCAT: The total revenues collected by the end of the first half of 2022 amounted to RO 6.724 billion, comprising a rise by 54.2 per cent compared to RO 4.361 billion registered over the same period in 2021.
The collected revenues accounted for 63.6 per cent of total revenues estimated in the 2022 Budget which were RO 10.580 million. This increase is attributed to net oil revenues going up by the end of the first half of 2022 by 40.1 per cent to reach RO 3.187 billion compared to the same period in 2021.
This is as a result of a rise in average oil price to 87 US Dollars per barrel compared to 53 US Dollars per barrel achieved over the same period in 2021 as well as a rise in average oil production to 1,037,000 barrels per day compared to 952,000 barrels per day registered over the same period in 2021. Gas revenues by the end of the first half of 2022 hit RO 1.729 billion, comprising a surge by 137.8 per cent compared to the same period in 2021.
This is a result of higher gas prices and production.
At the end of the first half of 2022, current revenues amounted to RO 1.796 billion, up by 34.3 per cent compared to the same period in 2021.
Tax and fees revenues amounted to RO 1.125 billion, growing by 71.5 per cent compared to the same period in 2021. At the end of the first half of 2022, corporate income tax stood at RO 424 million, increasing by 23.3 per cent compared to the same period in 2021. Moreover, excise tax and VAT revenues amounted to RO 48 million and RO 345 million respectively by the end of the first half of 2022.
Further, other revenues amounted to RO 671 million, including RO 392 million of dividends received from Oman Investment Authority (OIA) at the end of the first half of 2022.
Public spending by the end of the first half of 2022 reached RO 5.941 billion, rising by 8.6 per cent compared to the same period in 2021. Public spending amounted for 48.9 per cent of the 2022
Budget estimates of RO 12.130 billion. Development expenditure amounted to RO 413 million, up by 38.1 per cent compared to RO 299 million reported over the same period in 2021. Current expenditure at the end of the first half of 2022 amounted to RO 4.550 billion, increasing by 13.5 per cent compared to the same period in 2021. This is driven by an increase by 154.6% in gas purchase and transport expenditure to reach RO 639 million and a rise by 31.7 per cent in public debt service to RO 521 million.
Total contributions and other expenses by the end of the first half of 2022 reached RO 863 million, going up by 88 per cent compared to the same period in 2021. This is due to a rise in oil products subsidy to RO 314 million and an allocated RO 100 million for future debt obligations budget-item which aims to repay part of future loans.
At the end of the first half of 2022, the budget posted a surplus of RO 784 million compared to a deficit of RO 1.108 billion over the same period in 2021. During the first half of 2022, the Ministry of Finance paid the private sector’s dues received via the fiscal system which completed the documentary cycle and stood at RO 504 million.
The government benefited from the additional revenues during 2022 by accelerating economic recovery through increasing development expenditure to RO 1.100 billion compared to previous figures, up by RO 200 million to be allocated for priority projects and economic and social impact.
As of the end of June 2022, development expenditure amounted to RO 413 million, increasing by 38.1 per cent compared to RO 299 million reported over the same period in 2021. RO 650 million were allocated for implementing additional development projects to be added to the projects list of the 10th Five-Year Development Plan (2021-2025).
Such projects would be implemented across various health, education, housing, transport, tourism and municipal sectors. In light of the current global geopolitical situations, which led to a rise in oil prices and price of basic food commodities, the government revised the subsidies to mitigate the implications. By the end of the first half of 2022, government subsidy amounted to RO 314 million allocated for oil products subsidy (fuel prices were fixed in November 2021) and RO 11 million allocated for basic food subsidy.
Oman’s liability management exercise reduces public debt by buying-back some of the sovereign bonds for less than its nominal value, repayment of high cost loans and issuance of government Sukuk in Muscat Stock Exchange at preferable rates.
This contributed to declining total public debt which amounted to RO 18.6 billion by the end of July 2022. Debt servicing cost achieved a saving of RO 127 million, in addition to enhancing investor’s confidence and improving Oman’s credit ratings. - ONA
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