On August 29th, the President of the Republic of Timor-Leste, José Ramos-Horta, promulgated Law no. 17/2023 of August 29th on the Amending General State Budget for 2023, with a total consolidated expenditure foreseen of US$ 1.77 billion.
The organisational changes made to the Government by Decree-Law no. 46/2023 of July 28th, the Organic Law of the 9th Constitutional Government, required adjustments to the headings of the General State Budget, aiming to optimise the management of public resources.
To control public accounts, the expenditure planned in the 2023 General State Budget was reduced, as was the amount of the transfer from the Petroleum Fund, reflecting the Government’s commitment to ensuring the country’s financial sustainability.
To ease the impact of inflation and the increase in the cost of living on citizens, an adjustment has been made to the excise duty and import customs duty rates applicable in 2023 to protect the population’s purchasing power.
The amendments include changes to articles 3 and 4 of Law no. 15/2022, of December 21st, the 2023 General State Budget, and the tables in the Annex to the same law. There is also the first amendment to Law no. 2/2022, of February 10th, on the Framework of the General State Budget and Public Financial Management to ensure greater rigour and transparency in implementing the General State Budget and in public finances.
In addition, this law makes the second amendment to Law no. 8/2008, of June 30th, the Tax Law, amended by Law no. 5/2019, of August 27th, to clarify the concept of permanent establishment provided for in the Tax Law.
This newly approved budget allocates US$ 439,060,944 US to economic affairs, US$ 24,965,254 to housing and collective infrastructure, US$ 94,411,189 to health, US$ 136,974,446 to education and US$ 253,389,284 to social protection.
Prime Minister Kay Rala Xanana Gusmão stated in his speech presenting the Law Proposal that “the 9th Constitutional Government is fully committed to a fiscal policy that will lead to the country’s economic development, and that spending and revenue will be administered scrupulously and efficiently, to promote once again confidence, not only among our citizens but also among investors”.
With these amendments, authorised transfers from the Petroleum Fund drop from US$ 1.35 billion to US$ 1.21 billion.