RP breaches 1st-half deficit ceiling on low revenue

The Philippines' budget deficit breached an earlier forecast as spending rose and tax revenue missed targets in the first half of the year. The six-month deficit widened to P196.7 billion against the previous administration's forecast of P178.5 billion. In June alone, the shortfall was P34.6 billion. Total collections in the first six months amounted to P592.1 billion. The Bureau of Internal Revenue generated P403.5 billion, while the Bureau of Customs posted P130.7 billion and the Bureau of Treasury reported P24.9 billion. Other government offices reported P33 billion. Because of the unplanned budget spending, total expenditures in the first six months amounted to P788.8 billion, up by 13 percent higher from a year earlier. President Benigno Aquino III's economic team has widened the 2010 budget-deficit target to a record P325 billion as he vowed higher spending on agriculture and infrastructure. The 2010 deficit target is 3.9 percent of local output or gross domestic product. Meanwhile, the government is determined to meet its P325-billion deficit target for the year despite breaching its first semester ceiling by P18.2 billion, Budget Secretary Florencio Abad said. "We have to analyze the latest level and find out what brought about the surpassing of the level previously set by the previous administration. Then, on that basis, we will review our revenue generation and expenditure program. But offhand, we are determined to keep within the DBCC target recently set," he said. The Development Budget Coordination Council recently raised the deficit ceiling this year from P300 billion to P325 billion to give the government more room for spending on infrastructure and social services. —JE/VS, GMANews.TV