In Brief: Key Takeaways from the 2026/2027 Budget
- The Numbers: A $63.368 billion expenditure package against $59.729 billion in revenue, resulting in a manageable deficit of 2.1% of GDP.
- Energy & Industry: The government is moving forward with a phased restart of the Guaracara Refinery at Pointe-a-Pierre and accelerating new natural gas projects.
- Citizen Investments: Launch of Retail Government Securities and Savings Bonds, allowing ordinary citizens to invest in TTD and USD bonds with as little as $1,000.
- Tax Reforms: Introduction of a VAT on remote digital services, mandatory e-filing for all taxpayers, closure of withholding tax loopholes, and a 20% customs duty on vaping products.
- Social Relief: A $250 monthly increase to Senior Citizens’, Public Assistance, and Disability grants, plus an increase in the tax-free personal allowance for pensioners to $102,000.
- Tobago: An allocation of $3.473 billion (5.48% of the national budget) to fund new direct flights, housing, and a new Oncology Centre.
- Excise Duty Cut: The government will reduce excise rates on all alcoholic beverages—both locally produced and imported—by 25%.
- Electricity Surcharge of 5 cents per kilowatt-hour: It will applied on residential consumption that exceeds 3,000 kilowatt-hours per billing period. He assured the public that this will not affect 90% of consumers.
By Prior Beharry and Alicia Chamely
Finance Minister Davendranath Tancoo delivered the 2026/2027 National Budget to the House of Representatives, unveiling a $63.368 billion expenditure plan aimed at expanding production, modernising tax compliance and empowering ordinary citizens.
Declaring a robust economic turnaround after 18 months of a UNC government, Tancoo’s presentation operated under the theme, “We promised. We delivered. More to come!” He said that the Heritage and Stabilization Fund (HSF) has grown to a historic US$6.58 billion and the national deficit has been stabilised.
Fiscal Framework and Macroeconomic Outlook
The 2026/2027 budget is pegged to an oil price of US$77.00 per barrel and a natural gas price of US$5.00 per MMBtu.
| Fiscal Indicator | 2026/2027 Estimate |
|---|---|
| Total Revenue | $59.729 billion |
| Total Expenditure | $63.368 billion |
| Fiscal Deficit | $3.639 billion (2.1% of GDP) |
Reigniting the energy sector
Blaming the previous administration for a 45% collapse in natural gas output, Tancoo noted the new Energy Accelerator Hub to fast-track projects, with new gas already flowing from bpTT’s Cypre and EOG’s Mento fields.
He said the government was advancing the phased restart of the Guaracara Refinery at Pointe-a-Pierre. Proposals from a shortlist of investors are currently being evaluated to restore fuel security and revitalise fence-line communities.
Tanco said, “We cannot speak about energy without speaking about the Petrotrin Refinery. This is more than just reviving a dormant industrial asset to protect our fuel security. This is about reinstating the very lifeline to communities, downstream contractors, micro-enterprises, doubles vendors, roti shops…
“Thousands of residents in communities from Couva to Cedros were suddenly left traumatized by a loss of income to meet the needs of their family since 2018.”
“We went with a stroke of a PNM pen from being a net exporter of refined products to having to import every single litre of diesel, of gasoline, of pitch oil and of engine oil used in this country.
“We will restart the refinery. We are advancing the phased restart of the Guaracara Refinery at Pointe-a-Pierre. Following receipt of the Comprehensive Report of the Refinery Restart Committee, Government is evaluating proposals from a shortlist of serious local and international investors. Let me be clear, we will approach the restart of this national asset with fiscal discipline. Our objective is to secure a credible, commercially viable and fully financed arrangement that protects the national interest while creating the conditions for renewed economic activity.
“We will return economic momentum and retore confidence in many communities linked to the refinery and dependent on the energy sector.”Chaguanas West MP Dr Neil Gosine is on his way to listen to the 2026/2-7 National Budget. AZP News/Alicia Chamely
Tancoo with the prompting of his members said, “Who blew out the flame at Pointe-a-Pierre, those members opposite.”
He also quipped, “To quote my colleague, ‘let there be light.’”
Sweeping tax reforms and compliance
To balance economic support with revenue generation, Tancoo introduced aggressive fiscal measures taking effect in 2027:To balance economic support with revenue generation, Tancoo introduced aggressive fiscal measures taking effect in 2027:
Health & Environment: Vaping will be strictly regulated, banned in public and for those under 21, and incur a 20% customs duty. Meanwhile, an electricity surcharge of 5 cents per kWh will apply to high-usage residential households (over 3,000 kWh) to subsidise low-income users.
Digital VAT & E-Filing: A Value Added Tax will be applied to digital services from non-resident providers (yielding $18M). Additionally, all taxpayers will transition to mandatory e-filing via the GENTAX system, and a $100 penalty will apply for non-filed VAT returns.
Closing Loopholes: The Income Tax Act will be amended to capture withholding tax on remote services supplied by non-residents, expected to generate $300 million. Deductions for expenses incurred in earning exempt income will also be disallowed.
Corporate & Energy Taxes: The Unemployment Levy on petroleum companies will increase from 5% to 8%, and the utilization of carried-forward business losses will be capped at 75% of chargeable profits.
Empowering citizens and deepening capital markets
The government is launching the Government Savings Bond and Retail Government Securities Programmes. These initiatives will allow ordinary citizens—such as teachers, nurses, and small business owners—to invest directly in government bonds in both TTD and USD, with denominations as low as $1,000 or $5,000.Energy Minister Dr Roodal Moonilal outside teh Red House before the 2026/2027 Budget. AZP News/Alicia Chamely
Additionally, the foreign currency declaration threshold for travellers will be doubled from US$5,000 to US$10,000, and a permanent regulatory framework for virtual assets (cryptocurrency) will be established.
Social relief, youth, and public sector wages
To protect the vulnerable, the government announced significant increases to the social safety net:
• Pensioner Relief: The Personal Allowance for pensioners will increase from $90,000 to $102,000.
• Grant Increases: $250 monthly will be added to the Senior Citizens’ Pension, Public Assistance Grant, and Disability Assistance Grant.
• Wages & Subsidies: The fuel subsidy will be maintained to keep Super gasoline at $5.97 per litre, and nearly $2.5 billion has been allocated to settle outstanding public sector wage arrears.
For the youth, the government is launching the ‘READY’ Internship Programme, providing 1,300 students with summer work experience and a $1,500 stipend.
A $16.3 million expansion of Technical and Vocational Education (TVET) will also roll out across secondary schools.
Tobago’s development and national security
Tobago received a total allocation of $3.473 billion (5.48% of the budget). Key highlights include the opening of the new terminal at the ANR Robinson International Airport, new direct flight routes, and the establishment of a Tobago-based Oncology Centre.
Addressing national security, Tancoo reported a drop of 118 murders between January and July 2026 compared to the previous year. The government is rolling out smarter policing tools, including facial recognition, and will transition to a modern Electronic Passport Issuing Control System in January 2027.
Healthcare
Tancoo said the government met a healthcare system in a ventilator.
He said, “Under the PNM, approximately $80 million in pharmaceuticals and medical supplies were allowed to expire. Think of the cancer, diabetes and heart patients who could have benefited. Instead, many had to make the sacrifices to buy these drugs or do without.
“The truth is we inherited a health care system on a ventilator.
“We have started the resuscitation process.”
Excise duty cut on alcohol
In a move aimed at providing relief to local manufacturers and leveling the playing field, Tancoo also announced a major overhaul of the taxation structure for alcoholic beverages.
Effective January 1, 2027, the government will reduce the applicable excise rates on alcoholic beverages by 25 percent.
During his budget presentation, Minister Tancoo explained that the reduction follows a review of previous excise duty hikes. The revised, lower rates will be applied evenly to both locally produced and imported alcoholic beverages, establishing a more consistent tax treatment across the board.
“These measures will provide some relief to our local manufacturers, establish greater consistency in the application of excise duties and create a more appropriate customs duty structure,” Tancoo stated.
In addition to the excise duty cut, the government is fundamentally changing how imported alcohol is taxed at the border. The customs duty structure for imported alcoholic beverages will shift from the current volume-based specific duties to an ad valorem rate, which is based on the actual financial value of the product.
This change will specifically impact imported alcoholic beverages that do not currently benefit from preferential customs treatment under Trinidad and Tobago’s existing trade agreements. Under the new value-based system, higher-end, more expensive imported alcohol will bear a proportionally higher amount of customs duty.
Minister Tancoo noted that this dual approach—cutting the baseline excise duty while targeting higher-value imports with the ad valorem rate—is designed to achieve a fairer balance. The government aims to support the local manufacturing sector and ensure fair competition with imports, all while maintaining an appropriate flow of revenue to the State.
But, he noted that this would not this cut would not apply to items considered luxury drinks.
Increase in registration for classic, antique, vintage cars
Tancoo also outlined plans to foster a new economic niche centered around automotive history.
“The Government is developing a niche industry around the collection, restoration and preservation of historic motor vehicles, creating opportunities for skilled trades and specialised services while supporting automotive shows, cultural events and tourism,” Tancoo announced.
To facilitate this, the government will establish formal regulations governing the importation, registration, and use of Classic, Antique, and Vintage motor vehicles. This will include specific import controls and a tiered taxation system.
Under the new arrangements, the Motor Vehicle Tax applied to these specialty cars will see significant hikes. The tax rate will increase by 100 percent for Classic vehicles, 50 percent for Antique vehicles, and 25 percent for Vintage vehicles.
Electricity Surcharge of 5 cents per kilowatt-hour
Tancoo also proposed an electricity surcharge of 5 cents per kilowatt-hour on residential consumption that exceeds 3,000 kilowatt-hours per billing period. He assured the public that average households with moderate levels of electricity usage will remain completely unaffected by this threshold.
He said it will only affect 10% of T&TEC customers.
“Efficient management of our energy resources should encourage conservation while protecting households with modest energy needs,” Tancoo stated.
The revenue generated from this surcharge—expected to bring in an additional $17.8 million to the State—will be directly used to help finance the existing electricity subsidy provided to households with very low levels of electricity consumption.
