RP MAY END THE YEAR WITH A P300-M BUDGET SURPLUS
MANILA, DECEMBER 31, 2007 (STAR) By Iris C. Gonzales - The Philippines may end the year with a budget surplus of P300 million if total revenues reach P1.136 trillion, the best possible fiscal scenario for 2007, Finance Secretary Margarito Teves said in a presentation to the National Economic and Development Authority (NEDA) board meeting last Friday.
On the other hand, if revenues reach only P1.126 trillion, the government will end the year with a budget deficit of P15.1 billion.
This, Teves said, would be the worst fiscal scenario for the year as he presented to policy planners three new possible fiscal pictures for the Philippines following the higher-than-expected proceeds from the sale of the government’s stake in PNOC-Energy Development Corp. (PNOC-EDC) in November.
The Finance department, however, has not yet announced any change in its official target to contain the budget deficit at P63 billion in 2007.
Teves said the P300 million-surplus assumes tax revenues of P936.6 billion and non-tax revenues of P200.2 billion.
The medium case scenario is that the government will be able to contain the deficit at P9.1 billion or 0.1 percent of gross domestic product (GDP). This fiscal position assumes that tax revenues will reach P933.6 billion and non-tax revenues will reach P199.1 billion by yearend or total revenues of P1.132 trillion. It also assumes that expenditures will reach P1.141 trillion.
The worst case scenario of a P15.1 billion deficit, on the other hand, expects total revenues to reach only P1.126 trillion. Of the amount, tax revenues are expected to reach P927.6 billion while non-tax revenues are expected to reach P199.1 billion. Under this scenario, expenditures are expected to reach P1.141 trillion.
The P15.1-billion gap is equivalent to 0.2 percent of gross domestic product.
In his presentation, Teves said that higher non-tax revenues including privatization proceeds and contributions from government-owned and controlled corporations (GOCCs) have compensated for the shortfall in tax collection.
In November, the Philippines recorded its highest ever monthly budget surplus of P54.1 billion, boosted by hefty proceeds from the PNOC-EDC sale.
The November figure put the budget surplus for the first 11 months of the year at P12.7 billion, against a shortfall of P55.1 billion last year. The targeted surplus for November was P2.725 billion.
The government attributed the surplus to the sale of PNOC-EDC last month amounting to P58.5 billion, of which P47 billion went to state coffers.
Red Vulcan Holdings Corp., a consortium led by First Gen Corp. of the Lopez Group bagged the government’s 60 percent stake in the country’s top geothermal firm. The P58.5 billion winning bid exceeded government expectations.
Originally, the DOF expected to raise only P32 billion to P36 billion from the PNOC-EDC auction.
Without the proceeds from the PNOC-EDC, the government would have recorded a budget deficit of P35 billion from January to November.
Chief News Editor: Sol Jose Vanzi
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