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Wednesday, September 22, 2004
Arroyo to lawmakers: Prioritize tax bills
MANILA -- President Arroyo's administration said Tuesday that priority should be given to its eight tax reform measures over the proposed P907.6 billion 2005 national budget.
A spokesman of President Arroyo, Ignacio Bunye, said Congress could continue to deliberate on the budget but should not shelve discussion on the new tax measures intended to raise revenues for government.
Nevertheless, Bunye said Arroyo is confident that the legislators know the gravity of the problem and that they will act quickly to solve it.
The country posted a budget deficit of P11.7 billion in August, pushing the fiscal shortfall to P111.1 billion for the eight-month period, according to the finance department Tuesday.
Bunye said what the country is experiencing are "symptoms" of a financial illness.
He added, however, that there is no need to give President Arroyo additional powers as long as the tax measures are passed.
The country's August revenues totaled P59.7 billion against expenditures of P71.4 billion.
For the January to August period, revenues hit P462.4 billion while expenditures were at P573.5 billion.
The government is aiming to limit the budget deficit to P197.8 billion for the whole year or 4.2 percent of gross domestic product.
ING Financial Markets said Manila should be able to keep its full-year target, given the August deficit figure, while nothing that concerns over the poor fiscal performance will continue to hound government.
"The government realizes that there is zero tolerance for budget slippages and will strive to keep the deficit close to its target, if not outperform it," ING said in a research note.
President Arroyo warned on Tuesday of "economic death" in two years should Congress fail to pass the new tax laws aimed at increasing revenues by at least P80 billion.
A recent survey indicated that most Filipinos are against new taxes.
One of the measures certified as urgent by Arroyo, the tax amnesty bill, will not cover actual or pending tax cases, according to Bunye.
Arroyo, in a statement, said congressmen should be lauded for "moving towards greater sacrifice and transparency" by fitting the budget to the present crisis.
Arroyo said she is confident that each principled consensus will pave the way for the early deliberation and passage of the tax measures.
"The public may rest in the confidence that we have strong and dynamic democratic institutions that can always find a middle ground to confront crisis and difficulty and to find unity in working for the general welfare," she said.
She assured the public that the executive will bear an equal measure of the sacrifice that it is asking the public to suffer.
Senators, however, expressed fear that line item budgeting may delay the passage of 2005 national budget.
Among those who rejected line item budgeting are Senators Manuel Villar, chairman of the Senate committee on finance, Panfilo Lacson, Miriam Defensor-Santiago, Joker Arroyo and Senate Minority Leader Aquilino Pimentel.
Villar said because the procedure is very tedious, it might delay the passage of the budget and Congress may therefore have to resort to reenacting the budget.
Lacson, for his part, said legal problems could loom if the House pushes through with line item budgeting.
He said the budget could not be reenacted twice because the Constitution has no provision allowing that.
Also, he added that many lawmakers would likely take up much time defending projects they want to fund with their pork barrel funds.
On the other hand, Senators Pimentel, Santiago and Arroyo said line item budgeting is "hidden pork barrel."
They also said line item budgeting system will not eradicate graft because some lawmakers may still find ways to squeeze money out of it. (JMR/JPM/With AFP)
(September 22, 2004 issue)
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