Page 222 - Bahrain Gov annual reports(V)_Neat

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FINANCE
Adoption of Gregorian Calendar. Until the end of the year 1372 Hejira, September 1953,
all budgets and accounts have followed the Hejira (Islamic) Calendar which is the lunar
calendar. This has frequently presented difficulties. His Highness eventually approved of the
budget and the Government accounts being kept according to the Gregorian Calender although,
for the time being, he stipulated that all monthly salaries should continue to be paid by the
Hejira Calendar. It is hoped, however, that it will soon be possible to adopt the Gregorian
Calendar for all purposes. When this change occurs it will be necessary to make some adjust­
ments, possibly in leave conditions, to compensate people who are on monthly salaries for the
loss of about ten days pay a year, which would result from the change over from the Hejira to
the Gregorian Calendar. Owing to the adoption of the new system, from the end of 1372,
September 10th, 1953, it has not been possible to show a strict comparison between the actual
revenue and expenditure in 1953 and 1954, but a comparison can be made between 1954 and
1372. Most of the countries in the Middle East adopted the Gregorian Calendar, for practical
purposes, many years ago, though Saudi Arabia still adheres to the Islamic Calendar.

Revenue, 1954. The total revenue in 1954 was 667 lakhs, the estimated total revenue
was 5071 lakhs (sec last year’s Annual Report). In 1954 the Income Tax on oil was 440$ lakhs
and the duty on imported oil was 84 lakhs—the estimates were for 310 lakhs and 764 lakhs.
The substantial increase in the Income Tax was due to large payments being received during
1954, in accordance with the Income Tax Agreement, on account of the years 1952 and 1953.
Customs duties, etc., amounted to 1061 lakhs which was one lakh more than the collections in
the previous year. Interest from the Reserve Fund, which is now the third largest source of
revenue, was 19 £ lakhs, 7 lakhs more than in 1372. This was due to further additions to the
Reserve Fund by investment. Other sources of revenue produced about the same income as
in the previous year.

Expenditure, 1954. Expenditure in 1954 was very much higher than in 1372, it amounted
to 365$ lakhs as against 2481 lakhs in 1372. Of this increase in expenditure 95 lakhs more
than in the previous year, was the one-third of the oil revenue paid to the Privy Purse. Excluding
payments to the Privy Purse the amount spent on Social Services, Public Works and adminis­
tration was 190 lakhs. The Reserve Fund was increased during the year by 1391 lakhs. It has
been the policy of the Government for many years to add what it can to the Reserve Fund each
year in order to increase the income from that source with a view to the time when the oil
revenue begins to diminish. The Government also expends large sums on major public works
which will eventually produce revenue, such as the electric and water schemes, blocks of flats
for letting and other buildings, which bring in revenue. In 1954 the cost of new public works
and repairs and additions amounted to 62 lakhs as against 50 lakhs in 1372. The 1954 expend­
iture included 12$ lakhs spent on schools, 141 lakhs on hospital buildings, 4$ lakhs on Police
quarters and 51 lakhs on improvements to the Customs. The cost of the gas-electric scheme,
not included under Public Works, was 153$ lakhs.

Budget 1955. Revenue. In the Budget for 1955 revenue of 530J lakhs is anticipated,
of this sum 402 lakhs is oil revenue. Customs receipts arc estimated at 95 lakhs, interest from
the Reserve Fund is expected to produce 23 lakhs and all other revenue amounts only to about
10 lakhs. The estimate of oil revenue does not include any possible additional payments on
account of price adjustments and the customs receipts have been estimated on a conservative
basis.

Budget 1955. Expenditure. The estimated expenditure is 429$ lakhs, leaving 101 lakhs
for investment in the Reserve Fund, which at the end of 1954 stood at 747 lakhs. (Purchase
value 701 lakhs, face value 747 lakhs). In the total estimated expenditure 134 lakhs is the
one-third of the oil revenue which is paid to the Privy Purse. The balance, after deducting the
amount to be invested and the amount payable to the Privy Purse, is 295$ lakhs. The largest
item of expenditure is 75$ lakhs, which is to be spent on new public works; this includes the
provision of 40$ lakhs for hospital buildings (out of this 32 lakhs will be spent on the new
women’s hospital), 7 lakhs is the cost of new schools, 6 lakhs has been allocated for the com­
pletion of the working people’s houses at Qudhabia and for another group of workers’ houses

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