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PRESIDENT Arroyo said on Wednesday the government may
opt to again revise its balanced-budget target—attaining
it by 2009, instead of 2010—if the country’s fiscal
situation improves by next year.
She made
the statement at a forum on alternative fuel for public
transport and the launch of microfinancing for family
members of public-transport workers, while detailing
government efforts to provide relief to the poor through
extra revenues generated by the value-added tax on oil.
“Amid
the call to review economic policies, we have in fact
done our review months ago. Even then, we said that we
will need to forgo the pleasure of a balanced budge in
the pressing global environment. We announced our
willingness to spend as much as P75 billion if necessary
on social welfare. But if things improve next year, we
will return to our target,” she said.
The
President echoed the sentiment of Acting Socioeconomic
Planning Secretary Augusto Santos, who last week said
the government will push for a balanced budget by 2009
if conditions improve by that time.
If it
happens, it would be the third time the Arroyo
administration would be revising its balanced budget
target: before the oil price crunch, the government
moved its target from 2010 to 2008 because of its good
fiscal performance, but just this year decided to push
it back to 2010 to give it elbow room for more spending
to spur growth.
Finance
Secretary Margarito Teves told reporters that the
balanced budget target “could be next year depending on
the circumstances so it’s still fluid,” but at the
moment, the target is still 2010.
“Depending on how things are, if the world economy will
change, if the US economy will improve, then things
could happen dramatically but I guess conservatively,
were really looking at 2010….There are many factors that
would influence the fiscal operations, so we will look
into that but actually in our last discussion, we are
looking at 2010—but let’s see. Things might happen,”
Teves said.
For the
balanced budget to be attained in 2009, the government
will have to raise its revenue collections to 15.5
percent of the gross domestic product, he said.
“Translated to absolute terms the BIR and Customs have
to increase their collections significantly, [to] double
digit and close to 20 percent per annum. And basically
that will be the tax revenues because we’re not
expecting too much from non tax revenues or
privatization,” the finance chief said.
While
the government insists on the non-imposition of new
taxes, it will depend on Congress to pass revenue
enhancers such as the rationalization of fiscal
incentives and the restructuring of the sin taxes, and
reforms in the Bureau of Internal Revenue and the Bureau
of Customs to reduce smuggling. |
