Print PageDelivering a budget surplus is certainly possible, a federal Labor MP says.
Soaring iron ore prices have raised the possibility of a return to the black in 2012/13, a prospect regarded as unlikely by Treasurer Wayne Swan in December.
Forecasters from Deutsche Bank expect the price to be almost double the September mark within weeks.
Labor backbencher Andrew Leigh, a former economist, says lower commodity prices and an unusually high Australian dollar has knocked $20 billion off the government's projected revenues in the past year.
But achieving a surplus was "certainly possible".
"The treasurer last year didn't rule out a surplus, just said that one was looking unlikely given what's happened to revenues," he told Sky News on Monday.
Dr Leigh said if the Gillard government enjoyed the same tax-to-GDP ratio as the Howard government it would easily be achieving a surplus this year.
Opposition frontbencher Mitch Fifield said it was "complete garbage" to say revenue write-downs were the sole reason for the continuing deficit.
"They're big spenders, they're big taxers, they're not living within their means," he said.
Finance Minister Penny Wong said economists from across the spectrum had roundly agreed the government made the right call in not pursuing more spending cuts to achieve a surplus.
"But unsurprisingly, the government has been subjected to some criticism for this decision," she wrote on The Drum website.
Adding to the government's revenue problems is the lack of mining tax receipts.
Mining giants BHP Billiton, Rio Tinto and Xstrata reportedly won't make any second quarter payments under the minerals resource rent, which the government forecast to raise $2 billion in 2012/13.
The tax failed to raise any revenue in its first quarter of operation.
Dr Leigh said it was "the very nature of the beast" that revenues from a profits-based tax would be volatile.
Senator Fifield said the coalition would still abolish the tax should it win government.
"Even though so far it looks as though the mining companies haven't had to pay significant amounts of tax ... there still has been the damage to the economy on the issue of sovereign risk."
