Budget for Growth and Development
1. Madam Speaker, I beg to move that this honourable House approves the Financial Policy of the Government of Ghana for the year ending 31st December, 2012.
2. Madam Speaker, in doing so, I humbly stand before you to present the fourth Budget Statement and Economic Policy on behalf of the President, His Excellency, Prof. John Evans Atta Mills in accordance with article 179 of the 1992 Constitution.
3. Madam Speaker, this presentation is an abridged version of the 2012 Budget Statement. I would like to request the Hansard Department to capture the entire Budget Statement and Economic Policy tabled for your information and action.
4. Madam Speaker, the NDC Government was given the mandate to manage the affairs of this country in January 2009, based on our Manifesto for a â€žBetter Ghana . Our manifesto promises were anchored on transparent and accountable governance, a strong economy for real jobs, investing in people, and expanding infrastructure.
5. Madam Speaker, since the NDC came to power, I have had the singular honour and privilege to present three Budget Statements and Economic Policies on behalf of His Excellency Prof. John Evans Atta Mills to this august House. The implementation of all these budgets has significantly improved the standard of living of Ghanaians.
* There has been a significant growth in real GDP from 4.0 per cent in 2009, to 7.7 per cent in 2010 and 13.6 per cent in 2011 on provisional basis, making Ghana one of the fastest growing economies in the *
*Under the able leadership of His Excellency, Prof John Evans Atta Mills, coupled with the hard work of our cocoa farmers and other stakeholders, Ghana has now attained the 1.0 million metric tonnes of cocoa production for the first time in our history ahead of the 2012 schedule;
* At the end of 2008, the fiscal deficit on cash basis was 8.5 per cent of GDP (14.5 percent of GDP – old series). As at the end of September 2011, it had been reduced significantly to 2.0 percent of GDP;
* Inflation which was 18.1 per cent at the end of 2008 now stands at 8.40 per cent in September, 2011. This single digit inflation is real and has been sustained for the longest period of our economic history, from June 2010 to date;
* Interest rates have continuously declined since 2009. This is evidenced by the significant reduction in the yield of the 91-day money market instrument from 24.67 per cent in 2008 to 9.1 per cent in September 2011, making it the lowest recorded money market rate in decades;
* Gross International Reserves of US$4.98 billion recorded in October 2011 exceeded 3.0 months of import cover of goods and services, compared to reserves of US$2.0 billion at the end of December 2008, which could barely cover 2 months of imports. The gross international reserves realized in October 2011 is also the highest
* For the first time since the West Africa Monetary Zone (WAMZ) programme commenced in 2001, Ghana has met all the four primary convergence criteria as at end-June 2011;
* Significant progress has been made in improving the well-being of the vulnerable through social intervention such as removal of Schools under Trees, provision of free uniforms and text books, up-scaling of the school feeding programme and the Local Enterprises and Skills Development Programme (LESDEP).
6. Madam Speaker, for this, we acknowledge the contribution of Honourable members of this august House, Council of State, Colleague Ministers, the private sector, development partners and indeed all citizens of this country in supporting the agenda for a Better Ghana. I personally wish to express my profound gratitude to His Excellency the President for the honour and opportunity to present four consecutive Budgets on his behalf.
7. Madam Speaker, in the NDC Manifesto, we pledged to implement policies and programmes that would expand infrastructure, create jobs and provide the needed social services for the benefit of all Ghanaians.
8. Consequently, we have pursued with commitment, very solid socio-economic policies that have resulted in the restoration of fiscal consolidation and macroeconomic stability; and are on the brink of achieving the highest real GDP growth rate ever recorded in the history of this country.
9. Madam Speaker, the macroeconomic stability achieved has provided the appropriate platform for accelerated growth. The priority of government over the medium term is to find a solution to our infrastructure deficit that has hampered the country s accelerated development over the past decades.
10. The focus of the 2012 Budget is, therefore, on the provision of key infrastructure in various sectors of the economy, to further stimulate growth, support the private sector to create more jobs and improve the incomes of Ghanaians. For these reasons, the 2012 budget has been crafted around the theme 'Infrastructural Development for Accelerated Growth and Job Creation'.
11. Madam Speaker, the key infrastructural projects to be implemented in 2012 consistent with the Ghana Shared Growth and Development Agenda (GSGDA) will principally be in the following areas :
* Electricity, Oil and Gas;
* Water and Sanitation;
* Railways, Roads, and Ports;
* Health, Education, and
12. Madam Speaker, in pursuit of the social democratic principles of the NDC Government, the 2012 budget will continue the implementation of a number of pro-poor intervention programmes that will provide equal opportunities and improvement in the well-being of our people. In this respect, the scope of the numerous social intervention programmes will be expanded to benefit a greater number of vulnerable people in our society.
13. In order to accelerate the achievement of universal health coverage, Government will commence the implementation of the one-time premium payment policy under the National Health Insurance Scheme (NHIS). To further improve financial controls and efficiency, the NHIS will pilot Capitation, as an alternative Provider Payment Mechanism (PPM). Furthermore the review of the NHIS law would result in a major restructuring of the scheme at the district, regional and national levels.
14. Madam Speaker, the NDC Government promised to improve fiscal decentralization to deepen participatory democracy, bring public services closer to the people, and improve public financial management at the local level. In fulfillment of this promise, Government has set up a Fiscal Decentralization Unit within the Ministry of Finance and Economic Planning to implement fiscal decentralization programme which has been on the drawing board for decades.
15. Madam Speaker, the 2012 Budget will complete the next step which involves the transfer of resources in conformity with the principle of 'resources follow functions' through the Composite Budget framework.
16. Madam Speaker, the public sector wage bill constitutes the largest single expenditure item in the budget. The implementation of the Single Spine Pay Policy (SSPP) has resulted in as much as 41.2 per cent of total revenue being used to pay wages and salaries to public sector workers. This situation constrains government s spending in other areas. This notwithstanding, government is committed to ensuring equity and fairness in salary administration and will therefore continue implementation of the SSPP to its logical conclusion.
17. Government will also continue to implement policies that would substantially improve payroll administration through audits and the cleaning of the payroll to eliminate waste and excesses. In addition, Government will implement programmes to link public sector pay to productivity with a view to improving the performance of public sector workers.
18. Madam Speaker, as part of our democratic consolidation process, the nation goes to the polls once again in 2012. The Electoral Commission will conduct and supervise presidential and parliamentary elections. The NDC Government will adequately resource the EC to conduct free, fair and transparent elections to the satisfaction of all stakeholders.
19. Madam Speaker, this Budget Statement and Economic Policy will broadly cover the following:
I. Developments in the global
economy and their impact on the
II. Macroeconomic developments
in 2011 and outlook for 2012 and
the medium term;
III. Sectoral performance in 2011
and outlook for 2012; and
IV. Structural reforms and policy
initiatives for 2012.
GLOBAL ECONOMIC DEVELOPMENTS
20. Madam Speaker, the year 2011 witnessed a number of unanticipated events which adversely affected global growth and significantly weakened overall economic prospects. These include the devastating earthquake and tsunami in Japan, unrest in some oil-producing countries in North Africa, and major financial turbulence in the Euro zone. Consequently, the IMF projects global GDP growth in 2011 and 2012 to be much less than the 5 per cent achieved in 2010.
21. Growth in the advanced countries is projected to be very slow, attributed to the gradual reversal of the factors that held back activity during the second quarter of 2011. The growth prospects in emerging and developing economies however remain positive in 2011 and 2012, propelled mainly by high commodity prices.
22. Madam Speaker, Sub-Saharan Africa (SSA) witnessed strong macroeconomic performance in 2010 and 2011, with many economies in the region growing at rates close to their pre-crisis averages, largely on account of higher commodity prices and implementation of prudent macroeconomic programmes. For the oil-exporting economies in the region, the acceleration in growth, despite projected lower oil prices, reflects continued strength in domestic public investment spending and increase in oil production in some countries. Real GDP growth in the West African Monetary Zone is forecasted at 8.0 per cent in 2011, driven by increased activities in both the agricultural and industrial sectors in member countries.
Implications for Ghana s Economy
23. Madam Speaker, a further deterioration of the global economic environment could pose serious risk to the Ghanaian economy by undermining the prospects for export growth, remittances, official aid, and private capital flows.
RECENT MACROECONOMIC PERFORMANCE
24. Madam Speaker, Ghana s economy has witnessed significant growth and stability since 2009. The huge fiscal and external current account deficits that characterized the pre-2009 period have been reduced significantly; inflation has dropped to single-digit levels; the stock of international reserves has risen to over three months of import cover; and the exchange rate has stabilized since August 2009, except for some minor volatility earlier in the year. Real GDP growth has been very strong while the rebasing and revision of the national accounts saw the country s national income expanding by more than 60 percent, moving the country into a lower middle-income status.
25. Madam Speaker, a combination of fiscal consolidation and disinflation has underpinned the country s strong macroeconomic performance in recent years, especially in 2011. Through a strong growth in domestic revenue and prudent expenditure management, the country is on track to achieve the fiscal target set for the year.
26. During the year, the Bank of Ghana reduced its policy rate twice as inflation dropped to a single digit. While export growth, especially of cocoa and gold has been impressive and oil export came on stream, the external current account deficit widened in 2011 due to a strong import growth. Gross international reserves rose to more than 3 months cover of imports of goods and services. At the same time, the banking sector remained adequately capitalized and liquid, and nonperforming loans declined.
27. Madam Speaker, provisional GDP estimates released by the Ghana Statistical Service in October 2011 indicate that in real terms, the economy will expand by 13.6 percent in 2011 compared to the growth of 7.7 percent in 2010.
28. The agriculture sector expanded by 2.8 percent. The cocoa sub-sector grew by 14 percent. The remarkable growth in the cocoa sector is due mainly to policy interventions, such as the provision of subsidized fertilizers, supply of early bearing and high-yielding planting materials for rehabilitation of old farms, and timely payment of remunerative producer prices and bonuses, as well as the hard work of cocoa farmers. The country achieved its target of one million metric tonnes of cocoa production for the first time this year ahead of the 2012 schedule.
29. Madam Speaker, the Industry Sector recorded the highest growth of 36.2 percent this year, due mainly to the coming on stream of oil production.
30. Madam Speaker, the Services Sector continues to be the largest contributor to the country s GDP, accounting for 48.1 percent in 2011.
Oil Receipts and Distribution in 2011
31. Madam Speaker, His Excellency the President, Prof. John Evans Atta Mills made a pledge to ensure transparent and judicious management of oil revenues. In accordance with provisions of the Petroleum Revenue Management Act, Act 805, 2011 (PRMA), I now report on the receipts and distribution of oil revenue.
32. Madam Speaker, the Ghana National Petroleum Corporation (GNPC) has, on behalf of Government, lifted oil from the FPSO Kwame Nkrumah four times as at the end of October 2011. The proceeds from the first three liftings have been received. The proceeds for the fourth lift are expected later in November 2011.
33. Madam Speaker, the total volume of crude oil from the first three liftings amount to 2,980,720 barrels which realized a total sum of US$337.3 million (GH¢ 506.0 million).
34. The total oil revenue received so far has been allocated to the various allowable sources in accordance with the PRMA. A total of US$112 million (equivalent to GH¢168 million) has been transferred into the Consolidated Fund as the Annual Budget Funding Amount and is being utilized in the four priority areas as set out in the 2011 Supplementary Budget in accordance with relevant sections of the PRMA.
35. An amount of US$54.8 million and US$14.4 million have been transferred into the Stabilization and Heritage Fund accounts respectively in accordance with relevant sections of the PRMA.
36. In line with Section 7 of the PRMA, an amount of US$156.1 million has been transferred to GNPC as equity financing cost and GNPC s share of net Carried and Participating Interest.
37. Madam Speaker, a major objective of the 2011 Budget was to continue the progress in fiscal consolidation to support macroeconomic stability. To this end, the Budget set a fiscal deficit target of 5.1 percent of GDP to be achieved by strengthening expenditure management, and enhancing revenue mobilisation.
38. Madam Speaker, in reviewing the fiscal performance in 2011, provisional data up to the end of September 2011 have been used. Projections have been made to indicate the expected outturn for the whole year based on the provisional data up to September 2011.
39. Total revenue and grants for the first three quarters of the year amounted to GH¢8,798.2 million compared to the budget target of GH¢8,119.9 million. This represents an increase of 8.4 percent over the target. The high growth in revenue and grants was the result of improvements in tax revenue administration.
40. For the first three quarters of 2011, domestic revenue totalled GH¢8,177.0 million, equivalent to 14.4 percent of GDP. This amount, which was 15.9 percent higher than the budget estimate of GH¢7,055.0 million shows a significant improvement in domestic revenue mobilization. It is projected that by the end of the year, total domestic revenue will amount to GH¢11,835.7 million, 11.7 percent higher than the budget estimate of GH¢10,620.9 million.
41. During the first three quarters of the year, the disbursement of programme grants was 1.6 percent lower than the target of GH¢248.4 million. For project grants, the disbursement was 46 percent lower than the target of GH¢663.8 million. Grants disbursement is expected to reach GH¢984.4 million by the end of the year, which will be 26.8 percent lower than the budget estimate of 1,346.5 million.
42. Madam Speaker, total expenditure, including arrears clearance and commitments, in the first 9 months of 2011 amounted to GH¢10,412.3 million, equivalent to 18.3 percent of GDP. This figure is 1.2 percent lower than the budget target of GH¢10,543.8 million. For the whole year, total expenditure, including provision for arrears clearance and commitments is projected at GH¢15,565.5 million, or 6.0 percent higher than the 2011 budget estimate of GH¢14,397.4 million. The higher projected expenditure is attributed mainly to the higher-than-expected public sector wage bill resulting from the implementation of the single spine salary structure and the clearance of more than programmed during the year.
43. Madam Speaker, the overall budget balance for the period showed a deficit of 2.0 percent of GDP, compared with a budget target of 4.4 percent of GDP.
44. Based on the projected end-year data, the fiscal deficit in 2011 is expected to be 4.8 percent of GDP and the domestic primary balance, will register a surplus equivalent to 2.6 percent of GDP.
45. Madam Speaker, demand for money was generally strong in the first three quarters of the year. Broad money supply, including foreign currency deposits, grew by 41.9 percent year-on-year, driven mainly by a huge surge in accumulation of net foreign assets.
46. Madam Speaker, inflation has been on a downward trend since the peak level of 20.7 percent in June 2009. Inflation dropped and has remained in a single digit since June 2010. This decline has been driven mainly by a decline in food inflation. Developments in the first nine months of the year indicate that the end of year inflation target of 9.0 per cent will be achieved.
47. Madam Speaker, interest rates continued their downward trend during 2011 in line with declining inflation and inflationary expectations. The policy rate which stood at 18 per cent in December 2009 had by September 2011 dropped to 12.5 percent. Rates on Treasury bill instruments have also been on a downward trend, with the rates for the 91-day bill and 182-day bill.
48. Madam Speaker, the banking system continued to show a steady growth during the year, with its assets to GDP ratio rising to 43.5 percent in August 2010, from under 30.0 percent of GDP in 2008. Commercial banks lending rates have been trending down during the year, with the market leaders dropping their lending rates to 17 per cent and below. We expect all other banks to follow suit.
49. Madam Speaker, the external sector continued to show strong performance during the year. The trade balance recorded a deficit equal to 4.5% of the GDP for the first nine months of the year on account of a faster export growth. The stock of gross international reserves at the end of October 2011 stood at US$4.98 billion, enough to cover more than 3.0 months of imports of goods and services.
Public Debt Analysis
50. Madam Speaker, the total public debt increased from US$11.2 billion in September 2010 (representing 37.8 percent of GDP) to US$14.8 billion (representing 39.0 percent GDP) in September 2011.
51. As at end September 2011, external debt amounted to US$7.1 billion, representing 48 percent of the total public debt stock and 19.1 percent of GDP. The increase in external debt stock is attributed largely to a positive net flow of project loan disbursements compared to debt service payment on existing loans.
52. Domestic debt on the other hand increased from US$5,682 million in 2010 to US$7,521.6 million in September 2011, representing 51.0 percent of the total public debt stock and 19.9 percent of GDP. The increase in domestic debt is largely explained by the issuance of the 5-year and 3-year fixed rate bonds to settle arrears owed to contractors and securitization of TOR debt owed to Ghana Commercial Bank.
Debt Sustainability Assessment
53. Madam Speaker, in November 2011 the Government in collaboration with the International Monetary Fund (IMF) and the World Bank conducted the Debt Sustainability Analysis (DSA) which showed the public debt to be sustainable in the medium to long term, even when compared to the external debt thresholds.
54. The solvency and liquidity condition, which demonstrates the ability to service the public debt are, thus, favorable over the medium to long term. At a ratio of 33.6 percent of GDP in 2008, the public debt is expected to rise to 37.2 percent by 2015, by which period the CDB and other pipeline loans would have been disbursed.
55. The combination of fiscal consolidation sustained over the medium to long term, together with stronger real GDP growth, higher export levels, post-oil and gas production, contributes to a more favourable DSA baseline.
Petroleum Hedging Programme
56. Madam Speaker, Ghana s macroeconomic stability has been threatened in the past by external commodity price shocks, the key one being the price of crude oil.
57. Madam Speaker, rising crude oil prices has meant that Government has had to subsidize ex-pump price of petroleum products to the tune of GH¢267.61 million as at September 30, 2011. The entire under-recovery of petroleum pricing for the year is estimated to be GH¢364.94 million based on the assumption of crude oil price of US$110.23 per barrel.
58. Government has put in place a simple hedging mechanism to mitigate the impact of crude oil price fluctuations on crude oil receipts. The call option is adopted to manage oil import prices whilst the put option is adopted to smoothen fluctuations in crude oil export receipts. Madam Speaker, the hedging has contributed significantly to the stability of the economy in 2011.
59. The commencement of crude oil production has created a new price risk exposure for government revenue. In order to protect the revenue, the scope of the hedging programme was expanded in May 2011 to include petroleum revenues. The put option has been adopted under which Ghana has the option to sell crude oil at a price of US$107.00 per barrel. Currently, 100 percent of anticipated receipts of crude oil sales have been hedged to the end of 2011.
60. Madam Speaker, I am pleased to announce that the government hedging programme on petroleum has worked very well to reduce fluctuations in the oil export revenues and expenditures on imports.
MACROECONOMIC FRAMEWORK FOR THE MEDIUM-TERM (2012-14)
61. Madam Speaker, the Ghana Shared Growth and Development Agenda (GSGDA) focuses on structural transformation of Ghana s economy through industrialization, modernized agriculture and natural resource development. The overarching economic goal for the medium-to-long term is to ensure rapid and sustained economic growth and development.
62. In fiscal year 2012 and the medium term, government macroeconomic policy will focus on three complementary objectives, namely:
* preserving the gains of
macroeconomic stabilization and
fiscal consolidation achieved
* creating fiscal space for high-
priority investments to spur long-
term growth and development; and
* maintaining inflation in single
63. To achieve these objectives, fiscal deficits will be kept at levels that can be prudently financed, without crowding out private sector credit, while efforts to fill the country s large infrastructure gaps will be accelerated and kept consistent with the Ghana Shared Growth and Development Agenda (GSGDA).
64. Madam Speaker, over the medium term, economic growth is expected to average 8 percent, reflecting strong expansion in both the oil and non-oil sectors of the economy. The fiscal deficit reduction will be driven by rising oil revenues, strengthened revenue administration and prudent expenditure management. Monetary policy will be geared at maintaining single-digit inflation, while the balance of payments is projected to remain in surplus, reflecting high commodity export prices, oil production and exports, and continuing portfolio capital inflows
65. Madam Speaker, to finance infrastructure projects critical to the country s growth and development, a US$3 billion non-concessional but competitive facility from the China Development Bank has been sourced. In August 2011, Madam Speaker, this House mandated Government to negotiate and sign the Master Agreement for this facility.
66. Madam Speaker, the macroeconomic outlook for fiscal year 2012 is very positive. The economy is projected to grow by 9.4 percent in 2012, with the inflation rate remaining broadly stable at the upper single digit range. External demand for the country s exports is expected to remain strong, with oil production projected to rise further, while sizeable infrastructure investments and strong private demand is expected to support broad-based economic activity.
67. The details of the macroeconomic targets for fiscal 2012 are as follows:
* Real non-oil GDP growth of 7.6
* Real overall GDP growth of 9.4
* Average inflation of 8.7 percent;
* End-period inflation of 8.5
* Overall budget deficit
equivalent to 4.8 percent of GDP;
* Gross international reserves of
not less than three months of
import cover for goods and
68. Madam Speaker, notwithstanding the fact the 2012 is an election year, the NDC Government will maintain the fiscal consolidation achieved so far.
69. Madam Speaker, fiscal policy in 2012 will focus on strengthening revenue mobilization through further reforms in tax administration, managing the wage bill and implications of the implementation of the Single Spine Pay Policy; and controlling other recurrent expenditures. Government will also ensure that the disbursement of the USD3.0 billion loan from the China Development Bank is consistent with the medium-term fiscal plan and debt sustainability requirements.
Petroleum Revenues- Outlook for 2012
70. Madam Speaker, the total revenue from crude oil sales in 2012 fiscal year is projected at GH¢1,239.82 million based on an estimated average oil price of US$90.00 per barrel and production of 90,000 barrels per day. This amount comprises royalty payments of GH¢236.87 million, income from government Carried and Participating Interest of GH¢618.84 million, and corporate income tax of GH¢384.11 million.
71. Madam Speaker, as required by the PRMA, government wishes to submit to this august House for your consideration and approval a proposal for the Annual Budget Funding Amount (ABFA) for fiscal year 2012 to be set at 70 percent of the benchmark revenue, consistent with Section 18 of the PRMA.
72. Madam Speaker, transfer of oil revenue to the National Oil Company will amount to GH¢361.90 million. The benchmark revenue will amount to GH¢877.92 million. The proposed 70 percent of the benchmark revenue determined as the Annual Budget Funding Amount will amount to GH¢614.55 million. Transfer to the Ghana Petroleum funds will amount to GH¢263.28 million.
73. Madam Speaker, in line with Section 21(5) of the PRMA, the Annual Budget Funding Amount would be spent in the following four priority areas:
* Expenditure and amortization of
loans for oil and gas
* Road and other infrastructure;
* Agricultural modernization; and
* Capacity building (including oil
Monetary Sector Outlook
74. Madam Speaker, monetary policy in the medium-term will focus on maintaining single digit inflation while responding to volatility in the foreign exchange market. To this end, Bank of Ghana will continue to deploy its instruments within the inflation targeting framework to preserve the gains of macroeconomic stabilization.
75. Madam Speaker, recognizing the crucial role the private sector is expected to play in the country s growth and development process, real credit to the private sector will increase on a sustained basis to an average of 18 per cent per annum over the medium term. The Bank of Ghana will continue to engage the deposit money banks on the determination of base rates in the banking sector, with the view to bringing standardization and transparency into the determination of lending rates.
76. Madam Speaker, it is envisaged that there will be a further build-up in Gross International Reserves to an average of US$7.5 billion (estimated around 4.5 months of import cover) over the medium term.
77. The emergence of oil exports also brings along with it many benefits to the country, including high capital inflows from petroleum exports and the attraction of Ghana as a preferred investment destination. But such inflows of capital could pose significant risks to the management of the country s exchange rate. To this end, the Central Bank will ensure effective management of the exchange rate, with the view to maintaining adequate and sufficient foreign exchange reserves, export competitiveness, as well as smoothening excessive volatility on the foreign exchange market.
78. Madam Speaker, Government will build higher benchmark bonds. Seven-year and 10-year fixed rate bonds will be introduced in 2012 to reduce liquidity in the short-dated instruments and extend the yield curve. To mitigate the risks of rising floating interest rates for debt servicing, government will hedge the interest rates through swap arrangements to allow for enhanced predictability of debt service planning and forecast.
RESOURCE MOBILISATION AND ALLOCATION FOR 2012
79. Madam Speaker, as a result of the rebasing and revision of the national accounts, Ghana became a lower middle-income country. However, this resulted in a reduced tax revenue-to-GDP ratio from 22 percent to 13.1 percent in 2010. This figure is below the average of 15 percent for the sub-Saharan African countries and also below the average of 18 percent for lower middle-income countries.
80. Ghana s estimated tax revenue-GDP ratio outturn of 16.5 percent for 2011 indicates a strong improvement in revenue mobilization and is above the average for sub-Saharan African countries and below the average for lower middle-income countries.
Proposed Tax Policy Measures for 2012
81. Madam Speaker, while recognizing the strong revenue performance in 2011, the country needs to sustain the revenue mobilization efforts in view of the huge funding requirements to close the country s infrastructure gaps. The focus therefore of revenue management in fiscal year 2012 is to expand the tax base and improve the efficiency of the tax administration. The following tax proposals will therefore take effect in 2012.
Taxation of Professionals and Informal Sector
82. Madam Speaker, in fulfillment of the promise made in the 2011 Budget to focus attention on revenue contribution from the self-employed, the Self-Employment Income Tax Revenue Enhancing Project has been set up to broaden the tax net. Through this project, the contribution of the self-employed in the domestic tax revenue would improve from the current 4% to a targeted level of 8%.