The budget deficit could rise to $50 billion, it has emerged. Financial Secretary Donald Tsang Yam-kuen predicted a $10.7 billion surplus in his Budget delivered in February. But at the weekend Secretary for Treasury Denise Yue Chung-yee suggested the deficit might exceed $21 billion, a figure suggested after the announcement of the economic stimulus package in May. Treasury officials have admitted that the worst might be yet to come, with the final figure possibly hitting $50 billion. The Government would have to draw from reserves to cover the shortfall. The Rating and Valuation Department recently received more applications from companies not wanting to pay their withholding tax. More taxpayers have also applied for reassessment of their salary tax or for delayed provisional tax on the grounds that they will earn much less this year. The moratorium on land sales and a drop in stamp duty will also contribute to the fall in revenue. In anticipation of lean years ahead, the Treasury Bureau is looking at ways to reduce expenditure and boost revenue. The bureau is working with departments to reassess the worthiness of their work to determine how best to use the limited resources and whether more services should be contracted out to the private sector, it has been learned. The goal is to achieve a 'value government' with maximum benefit from the use of public money. Although the sale of government assets would significantly boost revenue, treasury officials are said to be extremely cautious about such a move.