Finance Minister Paula Cox yesterday projected Government revenues for the fiscal year were likely to exceed $800 million, because of higher than expected tax and fee income.

And she said that while spending would increase marginally over what was budgeted, Government expected to see its borrowing requirements drop to $52 million from the $98 million in new debt that was originally planned for this fiscal year.

Ms Cox revealed Government?s rosy economic picture at a Press conference yesterday unveiling the inaugural issue of a mid-year financial review, designed to give the Bermuda public a ?user friendly? update on the economy between budget reports.

A $49.5 million jump on prior revenue estimates of $750.5 million was largely attributed to higher receipts for customs duty, stamp duty, and payroll tax.

And while there has been a drop in passenger tax and hotel occupancy tax revenue because of lower air arrivals, Ms Cox said this had been offset by steady fee income from the Island?s thriving international business sector.

Tourism expenditure through September was 1.2 percent higher, and there were 839 new international businesses incorporated throughout the first nine months of the year.

The figures will not take into account a wave of reinsurance incorporations the Island has seen, as companies line up to take advantage of an expected rise in rates charged for 2006 policies, after the industry sustained heavy losses from unprecedented hurricane activity this year.

Taxpayers will have to wait until when the next budget is tabled in February to see if higher receipts could break down to savings for individuals with Ms Cox not willing to be drawn in advance on whether extra revenue could spell tax cuts in the year ahead.

While the rise in revenue is forecast to be about six percent ahead of earlier estimates, current expenditure is to be contained within 0.5 percent of what earlier estimates. Ms Cox said Government?s outlay should reach $715 million, compared to the $711.2 million previously projected. The increased spending is already earmarked for specific purposes, including Government?s $1.9 million support of the national cricket team.

Delays in capital projects should see expenditure in this area fall short of the $137 million set aside for this fiscal year, Ms Cox said.

And she said the Island?s economy was on track to meet targeted gross domestic product growth of between 2.5 and three percent in 2005. The Island?s GDP last year was $4 billion. Bermuda?s GDP growth is largely dependant on the pace of economic activity from the US.

While the US economy was ?impacted? by extensive damage in the southern states from hurricanes Katrina, Rita and Wilma, Ms Cox said it had not been ?derailed?.

The Bermuda Government Mid-Year Financial Review can be obtained free of charge, at least for the first issue, from the Department of Communications and Information, Government offices, Church Street.

Ms Cox said the glossy bulletin was paid for from the Ministry of Finance budget, and was within the amount set aside for publications and communications. She could not say what production costs were.