2013 budget deficit may breach ceiling, says DOF
The budget deficit may go over the ceiling set for 2013 due to the expected shortfall in tax collections for the full year and rise in public spending to further boost economic growth, the Department of Finance (DOF) said.
According to the DOF’s latest projections, the budget deficit for the year may reach P242.16 billion, or over P3 billion more than the P238.87-billion target.
But the latest estimate will still be equivalent to 2 percent of the projected gross domestic product (GDP) for the year, and may not affect the country’s credit standing. A deficit-to-GDP ratio of 2 percent may be considered manageable, Finance officials said.
Revenues from taxes, import duties, dividends from state-owned firms, fees and charges collected by state agencies are estimated to reach P1.742 trillion, slightly lower than the goal of P1.745 trillion set for the full year.
The DOF said that the Bureau of Internal Revenue, the main income earner of the government, may not be able to meet its collection target of P1.253 trillion.
But revenue officials said that the government had set a very high target. They added that the emerging figure on tax collection, projected at P1.249 trillion, still represented an 18-percent increase from the P1.058 trillion collected last year.
But they also acknowledged that the revenue agency could still improve tax collection by plugging leaks arising from tax evasion and under-declaration of incomes.
Also, the government expects expenditures for the full year to reach the full-year ceiling set at P1.98 trillion, even if public spending fell below expectations in the first semester.
In the first half of the year, expenditures reached only P890.75 billion, nearly P55 billion lower than the P945.65-billion cap.
The Department of Budget and Management earlier said that measures had already been undertaken to help government agencies catch up with their expenditure programs for the year. The measures include the streamlining of procedures to speed up the implementation of projects, the agency said.
It said payment procedures are also being enhanced so that contractors and suppliers are paid within a shorter period of time.