Technical Secretary of the Presidency Temistocles Montas announced yesterday that the government does not plan to propose new taxes until after the May 2006 election. He said the government would cut its own spending to reduce the fiscal deficit. Furthermore, he said that the government would not execute loans that have been contracted for RD$2 billion. He explained that the government has reached the limit of its debt-taking capacity. He said that the government will still have to honor the guarantees on the loans, regardless of whether these are disbursed or not and will pay the commissions that are due. As of May 2004, the country had contracted US$10.28 billion in loans. “Many times it is preferable to pay the commissions, and not execute the loans because the economy cannot bear more debt,” said Montas.
“We have come across a situation that discloses the chaos in which the past government handled its public finances. Everyone was borrowing money here,” he said as reported in El Caribe.