BIR likely met April collection goal of P79B

The Philippines, Asia’s biggest seller of overseas debt, "mostly likely" met its April tax collection target of P79 billion, Bureau of Internal Revenue Commissioner Jose Mario Buñag told reporters yesterday.

While the bureau collects 70 percent of government revenue, it’s "too early" to estimate the budget surplus or deficit for the month, Finance Secretary Gary Teves said at the same press conference. The government, which had a P67.6-billion deficit in the first quarter, aims to narrow its deficit to P125 billion this year from P146.5 billion last year.

Rising tax collections in April – the deadline for paying previous-year income taxes – may help the government meet its goal of ending deficits by 2008. The tax bureau collected P62.9 billion in April last year, a 19-percent gain from 2004.

Moody’s Investors Service Inc. may change the "negative" outlook on the Philippines’ junk debt rating to "stable," Teves said. Moody’s has a B1 rating on Philippine debt, four levels below investment grade and lower than the ratings of Standard & Poor’s and Fitch. It maintained its negative outlook on the rating last month. In February, S&P and Fitch raised their outlooks to stable, citing the increase in the value-added tax and the expansion of its coverage.

"Moody’s is willing to reconsider changing the negative outlook to stable for as long as we’re able to meet targets, especially of the expanded value-added tax," Teves said.

A negative outlook indicates a ratings company is more likely to lower the rating itself.

The Bureau of Customs exceeded its target of P16 billion in April by at least P300 million, its chief Napoleon Morales said at the press conference.

The Philippines will save as much as $32 million in interest payments when it completes a planned buyback of $411 million of so-called Brady bonds, Teves said. The government last month said it would complete the purchase by June. The government has $774 million of Brady bonds maturing through 2017.

The Philippines sold $4.3 billion of the bonds from 1990 to 1992, part of the reorganization of developing-country debt orchestrated by then US Treasury Secretary Nicholas Brady.