Government incurs 2010 budget gap of P314.4 B

MANILA, Philippines – The government incurred a budget deficit of P314.4 billion in 2010, P4.4 billion higher than the preliminary figure of P310 billion, mainly because of higher spending, the Department of Finance (DOF) announced yesterday.

Finance Secretary Cesar Purisima said that although the P314.4 billion-deficit is higher than what was earlier announced, the deficit to gross domestic product (GDP) ratio is still better than the program of 3.9 percent.

“What is important is that as a percentage of GDP, it is equivalent to 3.7 percent or below the program of 3.9 percent and the 3.9 percent recorded in 2009,” Purisima said.

“The lower-than-program deficit was realized because of improved revenue collections in the second half of the year as well as prudent spending exercised by the Aquino Administration,” Purisima also said.

Data from the DOF showed that total revenues reached P1.2 trillion or 7.5 percent higher than a year ago level.

Of the amount, collections of the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC) grew 9.6 and 17.7 percent, respectively. The BIR collected P822.6 billion while the BOC collected P259.2 billion.

Purisima said that BIR collections in the second half of last year or since the Aquino administration started its term, increased by 12 percent year–on-year. In contract, revenues generated by the BIR in the first half increased by only 7.4 percent, he also said.

Purisima said that the revenue reform measures put in place by the two agencies have been effective. –Iris C. Gonzales (The Philippine Star)