Zambia Budget Review: Revenue and Expenditure (2004-2014) by Kampamba Shula

1.          Trend analysis

1.1.       Revenue

1.1.1.      Overview

·         The highest revenue collections in the past 10 has been from Valued added tax followed by PAYE then by Customs, Excise and Trade Taxes.

·         Revenue collection of the broad forms of taxes improved dramatically after 2010 as can be seen from the graph above.

·         Mining tax which was royalty based increased dramatically in 2010. This was on account of an exceptional performance of mining tax revenue.

·         Domestic borrowing was low from 2003 to 2010 but has steadily increased over the last 5 years. External financing grew exponentially in from 2010 to become the second highest contributor to budget revenue in 2013.

1.2.        

1.3.       Expenditure

1.3.1.      Overview

·         Over the past 10 years General Public services accounted for the bulk of expenditure at 29%. It was followed by Economic affairs (25%) and Education at 18%. Health followed not so closely at 10%.

Review

·         Economic affairs (Purple) increased substantially compared to General public services(Blue) over the last 10 years.

·         Defence spending has steadily increased over the last 10 years with greater expansion especially over the last 5 years.

·         Education expenditure has constantly increased over the past years with sharp increases over the past five years.

·         Health expenditure on the other hand actually experienced a decline from 2009 to 2011 but showed good growth from 2012 to 2014.

·         Housing, Social protection and environmental protection have been relativel stagnant. Public order and safety showed good expenditure growth however.

Source: Ministry of Finance