FY04 revenue ‘lower than expected’

The government’s actual general fund revenue for fiscal year 2004 is nearly 7 percent lower than the expected amount of $218 million, records from the Department of Finance showed.

A DoF report presented by Finance Secretary Fermin Atalig Tuesday showed that the government had estimated to generate $218.098 million in FY 2004 but actual revenues only totaled $203.231 million.

Atalig noted, however, that the actual revenues would still go up because collectibles continue to be paid. “We’re not really finished yet for fiscal year 2004. There are still charges that are coming in,” he said.

The government collected only $168.3 million in total taxes for FY 2004, lower than the projected $187.4 million.

Huge revenue shortfalls were reported in personal/corporate income tax—which amounted to only $7.5 million versus the $19.8 million estimate—as well as bar tax, gaming jackpot tax, and liquid fuel tax.

Business gross revenue taxes only totaled $53.4 million versus the expected collection of $58.7 million.

For fees, services, and other revenues, the government received $34.9 million, which is 13 percent higher than the estimated revenue for the period.

Highest percentage collection was reported in hospital charges, totaling $17.5 million or 24 percent higher than expected, and amusement machine licenses, with a total of $8.2 million, compared with the projected $& million. The government, however, noted earlier that amusement machine fees should have, in fact, reached $14 million. Atalig had said the CNMI is losing up to $7 million a year through the illegal transfer of poker machines.

Atalig said that the actual shortfall in the total operating funds for FY 2004 was only less than 1 percent.

He said that, of the general appropriation of $213.9 million—the sum of $226.1 million in total operating resources minus $12.2 million for bond payment—the actual revenues during the period reached $213.8 million.

Atalig projects that the government would be getting $20 million in additional revenues in FY 2005 compared with FY 2004.

The Finance official said that based on the trend during the first two months of FY 2005, the government would realize $5 million in additional revenues every quarter.

He said that general fund revenues in the first two months of FY 2005 totaled $34.8 million—about 19 percent higher compared with the collection of $29.3 million during the same period last year.

DoF data showed that total taxes as of Nov. 30, 2004 reached $29.9 million as compared with $26.3 million in FY 2004, while total fees, services, and other revenues totaled nearly $5 million in the first two months of FY 2005, which is about $2 million more than last year.

The Babauta administration had requested for $226 million for FY 2005 but the Legislature had only approved $217.7 million.

The appropriation bill is now up for the governor’s review.