File
Dr. Omar Davies, Minister of Finance, cut $5 billion of spending from the budget over the April-June quarter.

Tax revenue collection to the end of June was running $390 million behind budget, but was up by almost 15 per cent or $5 billion compared to the June quarter of 2006.

The Finance Ministry reports that the taxes flowing to the treasury rose above $44.4 billion among total revenues of $55.7 billion, inclusive of fees, bauxite levy proceeds and grants.

All line items were below target, resulting in a collection shortfall over the quarter of a marginal 0.4 per cent or $200 million, but a near $5 billion saving on estimated expenditure - mostly cut from capital programmes - has produced a better fiscal deficit than estimated.

Instead of the expected $13.7 billion shortfall, Finance reported a deficit of $8.97 billion or 35 per cent better than projected for the review period.

The heaviest taxes were paid by salaried workers with personal income tax collections coming in just below $11 billion, compared to corporate taxes of $4.3 billion, while GCT on shelf goods and services amounted to $8.8 billion.

Overall GCT collections, when imports are factored, were $15.5 billion.

However, compared to the 2006 quarter, the deficit is running eight per cent higher.

Also for the quarter, Finance Minister Dr. Omar Davies tapped the markets for $34.7 billion or $5 billion less than he initially intended.

Primary balance

Last year, the treasury took in more than $52 billion in new borrowings over the same three-month period.

He retired or paid down $17.7 billion of the country's principal debt stock, $2.2 billion less than budgeted.

The primary balance, which gives a snapshot of the fiscal accounts minus debt-servicing charges, was higher than projected at $15.9 billion, but still four per cent below last year's $16.6 billion.

business@gleanerjm.com