English says Govt tax receipts $750m below forecast

Finance Minister Bill English. Photo / Mark Mitchell

Finance Minister Bill English has told Parliament's Finance and Expenditure Select Committee that tax revenues had softened in recent months and the government could reduce forecast revenues in the upcoming half year budget and economic forecast update in December, as large losses from companies over the last 18 months flow through to the government's tax take.

English said receipts for the two months after the government's latest accounts were $750 million below budget forecasts.

He said the government could have chosen a "more robust" path to recovery by putting taxes up and reducing spending by more.

English said there was a risk the budget deficit could be bigger than the forecast $13 billion for this financial year, although it was forecast to fall to $10 billion next year.

Meanwhile, English wouldn't be drawn on his expectation for GDP growth over the current quarter, telling Labour's David Cunliffe he didn't "really focus on quarter to quarter growth", as there could be a number of factors that influence the figures in the short term.

However, the Finance Minister said he expected the economy to continue growing, probably quarter on quarter.

INTEREST.CO.NZ