One of the three international credit rating firms said Monday that the Aquino administration's plan to increase state revenue by cracking down on tax evaders and smugglers may lead to higher credit ratings.

Andrew Colquhoun, Hong Kong-based head of Asia-Pacific sovereigns at Fitch Ratings, however, can't say whether President Aquino's plan to go after tax evaders and smugglers will be effective in raising additional revenues.

“The government has articulated a plan to raise revenues by cracking down on non-compliance. It's difficult for an outside analyst to assess how likely this is to work, but concrete evidence of success in a rising revenue take could put upwards pressure on the ratings,” Colquhoun said in an emailed reply to questions from Manila Bulletin.

The government raised its 2010 budget deficit goal last Friday to a record P325 billion and would be the biggest since at least 1985.

Inter-agency Development Budget Coordination Committee (DBCC) now plans to cut the financing gap to 3.3 percent of gross domestic product next year and 2 percent in 2013 from this year’s 3.9 percent.

“We have been expecting the deficit to come in around 4 percent of GDP in 2010 for some months now based on monthly budget out-turns, so no immediate rating impact from this announcement,” Colquhoun said.

Fitch has assigned 'BB' with stable outlook for the Philippines' credit credit rating. “In my view, the key factor weighing on the Philippines' ratings is the low fiscal revenue take – just 15 percent of GDP in 2009, the fourth-lowest of any sovereign we rate. This increases the sovereign's vulnerability to shocks in the economy or financial system,” Colquhoun said.

Despite the increase in deficit goal, Budget Secretary Florencio B. Abad, meanwhile, said the Aquino’s economic managers kept this year’s growth target at a range of 5 percent to 6 percent and raised next year’s GDP expansion forecast to a range of 7 percent to 8 percent.