MANILA, Philippines?The Arroyo administration will initially operate on a reenacted budget this year as the P1.54 trillion General Appropriations Act, which Congress rushed in approving two weeks ago, has not yet been signed by President Macapagal-Arroyo.

But House leaders assured it would only be for January amid concerns that a reenacted budget would give the administration more leeway in spending money during the election season.

"The budget is in the printing press. It will be sent to President Arroyo between Jan. 7 and 8. Until the President signs it or it lapses into law, we will be operating under a reenacted budget,?? said House Speaker Prospero Nograles.

Albay Rep. Edcel Lagman, senior vice chairman of the House committee on appropriations, said the government would operate under a reenacted budget for this month only.

"There is no scenario of an extended reenacted budget. This will just be for a short period. There will be no disruptions in government finances,?? Lagman said in a phone interview

The P1.541 trillion budget was ratified by both chambers of Congress before they went on recess for the holidays. Even if the President does not sign it, the budget automatically becomes law after 30 days.

Minority lawmakers are hoping the President would veto some of the provisions in the 2010 budget that diverged from her original proposal.

Sen. Manuel Roxas II claimed the budget was bloated by as much as P35 billion in pork barrel insertions, including an increase in the Priority Development Assistance Fund given to lawmakers from P6.94 billion to P9.666 billion and a P14 billion increase in the budget of the Department of Public Works and Highways. The adjustments were taken from the decrease in the debt service payments which were reduced by P64 billion.

Congress also has ruled out passing new tax measures despite the surge in the budget deficit to a record high.

Nograles said that imposing more taxes at this point was "ill-timed and ill-advised.??

"Additional taxation upon our people is the last thing in our mind today. The house leadership won?t even try it,? he said.

Quezon Rep. Danilo Suarez, an administration ally but a harsh critic of Nograles, has blamed the soaring budget deficit (expected to hit P300 billion from the revised estimate of P250 billion) on the House leadership?s failure to pass new taxes.

Suarez has been advocating the imposition of a tax on text messages and reforms in sin taxes to bolster government revenues and minimize the state?s borrowings.

But Nograles said that imposing new taxes would make the lawmakers appear insensitive to the plight of most Filipinos amid unemployment and lower consumer spending.

He said the tax on text and higher taxes on cigarettes and alcoholic drinks would be an additional burden to consumers whose welfare should be prioritized over the state of government?s finances.

?While additional tax measure may be justified its timing is very, very bad. And to disregard this national feeling is callousness of the highest order,? he said.

Suarez is also seeking the advance collection of income taxes from large taxpayers through House Resolution 50.

Addressing fears the funds would be used by the incumbent President, he said
the money to be raised from the proposed ?front-loading?? of income taxes from the country?s wealthiest individuals and most profitable corporations would be used by the next President.

"We don?t want to leave the next administration with no resources. In fact, our proposal allows him to have cash at his disposal without the government incurring more debt,?? said Suarez in a phone interview.

Under Resolution 50, the Bureau of Internal Revenue will be authorized ?to collect 10 percent from the gross sales/receipts of all large taxpayers, such as alcohol, tobacco, pharmaceutical, petroleum and telecommunications companies, as advance payment of taxes for the next two years [2010-2011] to serve as rehabilitation fund for all the provinces and regions devastated by the typhoons, to help address the ballooning budget deficit and to prevent the government from incurring more loans.?

Suarez said business groups have agreed to support his proposal.

Suarez said that he has scheduled a meeting between the BIR and the country?s 150 large taxpayers, both individuals and corporations, to finalize the guidelines for the front-loading of taxes.

"We have to agree how much discounts to give on the taxes that they would pay for 2011 and how will these estimates be reached,?? he said.