HGP Nightly News – The Dr Mohamed Irfaan Ali–led administration has maintained that Budget 2026 continues Guyana’s strong cost-of-living support measures, even as many countries globally scale back public spending in response to economic pressures. Speaking during a live broadcast reviewing the fiscal package, President Ali said his government has deliberately chosen a different path, keeping relief measures in place while simultaneously investing in long-term growth and opportunity creation.
He noted that since returning to office, the administration has remained focused on shielding ordinary Guyanese from rising costs associated with food, fuel, electricity and housing. “Ninety-five per cent of budgets globally are cutting back on measures like the ones we introduced in Guyana,” the President said. “We are continuing to finance those measures while at the same time building new ones to create wealth, expand opportunities and strengthen families.”
President Ali highlighted that VAT remains zero-rated on a wide range of basic food items and household necessities, a policy in place since Budget 2021. He also pointed to the removal of VAT on fertilisers, agrochemicals, pesticides and agricultural machinery, which he said reduces production costs for farmers and helps stabilise food prices. Fuel relief remains another central component of the government’s cost-of-living strategy.
According to the President, the continued removal of excise taxes on gasoline and diesel has saved consumers hundreds of billions of dollars over time. Subsidies on freight costs for imported food and essential goods are also being sustained, with the government estimating savings to consumers of nearly $20 billion. Utility prices, including electricity and water, will remain unchanged, with the government continuing to absorb subsidy costs.
The President recalled that VAT on electricity, water and medical supplies was removed in previous budgets, a measure that continues to cost the state billions annually but eases pressure on households. President Ali also linked Guyana’s comparatively low inflation rate to these interventions, noting that the country currently records one of the lowest inflation rates in Latin America and the Caribbean.
He attributed this to targeted fiscal measures and investments in agriculture, irrigation and local food production. At the same time, opposition figures have acknowledged the continuation of relief measures but argue that some households continue to feel pressure from rising prices, particularly for food, housing and transportation.
They have suggested that while subsidies help contain costs, stronger income-based interventions may be needed to further improve purchasing power for low- and middle-income earners. The government, however, maintains that Budget 2026 balances immediate relief with broader economic transformation, including housing subsidies, mortgage support, social grants, pension increases and tax adjustments, while laying the groundwork for income growth and job creation.
According to President Ali, the administration’s approach remains rooted in fiscal policy that protects citizens, stabilises prices and builds resilience. “Budget 2026 continues the tradition of financing measures that ensure price stability for food, reduce production costs and improve competitiveness, especially for small and medium enterprises,” the President said.
As parliamentary scrutiny continues, cost-of-living relief remains a key area of debate, with the government defending continuity and stability, and the opposition pressing for deeper adjustments to household income and affordability.
