The government is looking for additional revenue sources to limit the budget deficit to 1.2 percent of gross domestic product (GDP) this year, an official of the Finance Department said Wednesday.
Finance Undersecretary Gil Beltran said they are still optimistic that the government would be able to limit the budget shortfall to P102 billion or 1.2 percent of GDP this year by raising more revenues.
"We are always exploring and searching for additional sources of revenues to limit the deficit at P102 billion," said Beltran.
He added these would include, among others, measures being undertaken by the Bureau of Internal Revenue and the Bureau of Customs to increase their collection efficiencies.
Last Monday, Budget Secretary Rolando Andaya Jr. said the budget deficit is likely to balloon to P140 billion or 2.0 percent of GDP this year from P75 billion or 1 percent of GDP in 2008 as the government boosts spending to pump-prime the domestic economy.
Andaya noted that the automation project of the Commission on Elections alone would already result to a deficit of P114 billion.
On the other hand, Socioeconomic Planning Secretary Ralph Recto expects the budget shortfall to swell to P160 billion in 2009.
However, the official budget deficit cap for the year remains at P102 billion and proposed revisions has yet to be discussed by the Development Budget Coordination Committee, Beltran said.
Beltran said the government could generate more revenues from the sale of government assets and from higher remittances from government-owned and controlled corporations as well as state-run financial institutions.
The finance department expects to raise P20 billion this year from the sale of the 120-hectare property of Food Terminal Inc. in Taguig City as well as its 40 percent stake in PNOC-Exploration Corp.
Moreover, the finance department has been pushing three legislative measures including the rationalization of fiscal incentives, the simplified net income tax system, and the rationalization of excise tax on sin products that could generate P50 billion to P60 billion in additional revenues on the first year.
The simplified excise tax structure through imposing a two-tier system on the first year and a single rate on the second year in the case of cigarettes alone could generate between P90 billion and P120 billion in three years.
In the last few years, the Arroyo administration has implemented various reforms to put the fiscal house in order. But it decided to abandon its commitment to balance the budget last year due to adverse external developments brought about by the financial crisis in the US.