Gov’t sticks to deficit target

Finance Secretary Jose Isidro Camacho allayed market concerns yesterday over the government’s ballooning budget deficit, saying Manila was keeping its target of P130 billion for the year.

"We are sticking to our budget deficit target for the year. Any review will be done after the end of the first half," Camacho told reporters.

Camacho made the comments after bid rates for Philippine Treasury paper went up about 10-20 basis points at the secondary market as news of a shortfall in government revenue collections added to worries of an increase in domestic interest rates.

The latest government data, issued at the weekend, showed total revenues in the first five months of the year fell below target by 16.1 percent or P30,706 billion, indicating the government may have overshot its budget deficit target for the period.

Early estimates show the Bureau of Internal Revenue collected a total of only P159.869 billion in the first five months of the year, below the target of P190.575.

Camacho confirmed reports that for April alone, the BIR’s revenue collections reached P42.866 billion against the target of P53.838 billion.

The BIR accounts for more than 80 percent of the government’s total revenues.

The government exceeded its budget deficit ceiling by 15.6 percent in the first quarter of the year to P61.208 billion, mainly on a shortfall in revenues blamed on poor tax collections and lower interest rates.

The government has set a budget deficit goal of P130 billion this year from the actual deficit. — Ted Torres