CANBERRA - THE global economic crisis has slashed Australia's forecast budget surplus for the current fiscal year from 21.7 billion Australian dollars (S$20.9 billion) to A$5.4 billion, according to government figures released on Wednesday.

The midyear review figures for the year ending June 30, 2009, also showed that economic growth was expected to slow to 2.0 per cent for the year.

Growth of 2.75 per cent had been predicted when the government released it's annual budget in May.

Treasurer Wayne Swan said tax receipts would fall by around A$40 billion over the current year and the following two years below the estimates for the three years released in May.

'There's no point in trying to sugarcoat these figures', Mr Swan told reporters.

'The global financial crisis has smashed a A$40 billion hole in the budget. ... And of course, if international conditions were to deteriorate further, then there could be more to come', he added.

'This is yet another dramatic reminder that we are not immune from the impact of the global financial crisis,' Mr Swan said. 'As we are all aware, this is the biggest global upheaval since the Great Depression.' -- AP