A $605-million government debt repayment due by next January will be paid off in full, positioning Bermuda to eliminate national debt within a decade, the Premier announced today.

Delivering his 2026-27 Budget Statement, David Burt hailed the fiscal road map’s publication “a defining moment”.

Confirming that it would be his last as Premier and Minister of Finance, he said that the revenue and spending blueprint would help to bring down the high cost of living for Bermudians with a reduction in payroll taxes for all workers, as well as major investments in capital projects and social programmes, including housing, healthcare and education.

Mr Burt noted that transfers from the corporate income tax to the consolidated fund for 2025-26 totalled $279 million — “well above” initial estimates of $187.5 million.

That sum comes in addition to the $605 million the Government will use in CIT receipts to pay off a government bond due in January 2027.

He added: “For 2026-27, the Government projects corporate income tax revenue of $753 million.

“That figure reflects the balance of payments related to 2025 activity, adjusted for expected tax credits once final returns are assessed later in 2026, and it also includes an initial portion of payments expected for the 2026 calendar year.

“This level of revenue gives Bermuda options the Government simply has not had before, but we must be straight with the public about what it is and what it is not.

“These receipts will not be the same every year. Analysts have indicated that 2025 may represent the high point of a revenue cycle.

“As the cycle continues and the tax credit framework matures, we should expect gross corporate income tax revenues to moderate over time.”

The Premier said: “It would be irresponsible to use volatile corporate income tax receipts to fund the everyday costs of running government.

“This revenue should not be treated as permanent money for recurring spending.

“Instead, this Government will use it to reduce debt, build reserves and make targeted investments in infrastructure, permanently strengthening public services.”

Mr Burt said that Bermuda is on a path to increasing capital spending to 2 per cent of GDP by the next fiscal year following the “significant reduction in the national debt” achieved.

He revealed that capital expenditure for the 2026-27 fiscal year is estimated at $182 million, representing the largest planned capital programme since 2008-09.

The allocation marks an increase of $32.2 million over the original 2025-26 estimate of $149.8 million.

Mr Burt said that current account expenditure, excluding debt service, is estimated at $1.25 billion, an increase of $137.7 million, or 12.4 per cent, over the original estimate for this year of $1.11 billion.

Total revenue for 2026-27 was estimated at $2.03 billion, which the Premier said was a “landmark achievement” as, for the first time in history, government revenue is projected to exceed $2 billion.

His statement showed that the Progressive Labour Party administration delivered an audited consolidated fund budget surplus of $153.1 million for 2025-26 — a significant increase over the original estimate of $43.33 million.

In the upcoming fiscal year, the fund’s surplus was forecast to be $472.68 million.

The Premier said: “This 2026-27 Budget now projects the repayment in full of the $605 million senior notes maturing in January 2027.

“This decision will reduce gross debt from $3.29 billion to $2.69 billion.

“More importantly, it moves Bermuda onto a clear path to eliminate net debt within a decade.”

All ministries received a budget increase, with the Ministry of Health set to welcome the biggest boost — 23 per cent over the previous year.

Debt service and guarantee management costs for 2026-27 were estimated at $124.75 million, representing a decrease of $2.75 million, or 2.2 per cent, compared with the original estimate for 2025-26 of $127.5 million.

The $605 million debt repayment will reduce gross debt by 18 per cent and cut annual interest costs by 20 per cent, the Premier said.

Mr Burt told the House of Assembly that to ensure the debt reduction strategy is well executed, the Ministry of Finance will re-impanel the Debt Management Committee this year to guide the next phase of the island’s debt reduction plan.

The theme of the Budget, Responsible Choices … Lasting Benefits for Bermudians, Mr Burt said, reflected the Government’s efforts to make “careful, disciplined financial decisions that safeguard stability, while ensuring that economic progress translates into investment in the future and real improvements in the lives of our people”.

He said that no worker in Bermuda would pay more in employee payroll tax and that the total tax bill for all workers would go down.

With the elimination of the final 4 per cent per litre of customs duty on fuel for electricity generation, lower energy costs are projected.

“This reduction will mean that over the past two years, this PLP government has eliminated the taxes on fuel for electricity generation, saving the average household $375 a year,” Mr Burt said.

He said duty would be reduced on a wide range of essential goods while private car licensing fees will be reduced by a further 10 per cent, effective from April 1.

Current expenditure includes $87 million for the Bermuda Hospitals Board, the continued rollout of universal health coverage, and additional investment in the Health Insurance Department to provide greater levels of healthcare access.

As revealed in a Budget preview yesterday, the Government is allocating $15 million towards FutureCare premium subsidies for low-income seniors.

The Tax Reform Commission’s full recommendation was $30 million.

Mr Burt said the allocation represents the “first phase” of investment to provide coverage support for up to 2,200 seniors, approximately 15 per cent of Bermuda’s senior population.

Speaking on the critical need for investment in infrastructure, the Premier noted: “For too long, the Government has been forced to stretch the life of critical assets because the finances simply did not allow us to do what needed to be done.

“That approach comes with a cost, and eventually that cost shows up in breakdowns, delays and risks to public safety.”

The Budget includes $9.4 million for the Swing Bridge that connects St David’s and St George’s, and $8.8 million for the expansion of the Tynes Bay Waste-to-Energy facility.

It allocates $26.9 million for the Bermuda Housing Corporation to accelerate refurbishments and progress with new affordable units.

The Budget also contains $14 million in capital funding for the Ministry of Education to upgrade facilities and make investments in new technology for public schools and the Bermuda College.

The allocation increased by 71 per cent, and will be for maintenance and upkeep of all public schools.

Investments were dedicated to signature schools including for technological infrastructure upgrades but there was no mention of infrastructure funding for primary schools, some of which required new construction for extra students that had been expected under education reform plans that have since been put on hold.

Additionally, $1.5 million has been allocated to address dangerous walls and $5 million for a continued “aggressive roadworks programme”.

The Government is also investing $1.4 million in solar panels for government buildings along with $3.5 million for new buses, and $5.3 million for vital vehicles and equipment, while $3 million is set aside for smaller “community improvement projects”.

Mr Burt reflected: “This Budget is also a personal milestone for me as it will be my final one as Premier and Minister of Finance.

“When I entered public life, I did so with a deep sense of responsibility to serve this country and to help build a fairer, stronger Bermuda …

“I am proud of what this government has achieved, not because every problem has been solved, but because Bermuda today is more stable, more resilient and better positioned for the future than when this government took office.”

• To see the Budget Statement in full, see Related Media

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