Budget gap narrows to P18.9 billion in July

MANILA, Philippines — The national government narrowed its budget deficit to nearly P19 billion in July as revenues rose faster than expenditures, reflecting increased income for the government amid tamed spending.

Data from the Bureau of the Treasury (BTr) showed that the Marcos administration recorded a budget shortfall of P18.92 billion in July, a 34.4-percent decline from the P28.8 billion deficit in the same period last year.

Notably, the latest figure is significantly lower by 92 percent than the P241.6 billion shortfall recorded in June.

“This performance underscores the government’s commitment to support economic development while keeping within the bounds of prudent fiscal management,” the BTr said.

A budget deficit happens when government expenditures exceed revenue collections. In July, expenditures remained higher even as revenues grew at a faster pace.

For the seven-month period, the budget deficit widened by 22 percent to P784.4 billion, outpacing the P642.8 billion shortfall recorded in the same period last year.

Treasury data indicated that total revenue collection in July surged to P472.3 billion, equivalent to a 3.3-percent hike from P457.4 billion in the same period last year.

“The Bureau of Internal Revenue (BIR) sustained its strong performance due to higher revenues from corporate income tax,” the BTr said.

“This is followed by personal income tax, tax on government securities, excise tax on tobacco products, percentage tax on banks and financial institutions and documentary stamp tax,” it added.

Tax revenue collection comprised the bulk at P423 billion. In July alone, the BIR collected P335.3 billion, an improvement of nearly five percent year-on-year.

Meanwhile, the Bureau of Customs turned in six percent more with P85.2 billion from last year’s P80.4 billion.

Non-tax revenues, however, dropped by 9.7 percent to P49.3 billion from P54.6 billion a year ago. Income generated by the BTr posted an 82.4 percent increase to P36.3 billion from last year’s level of P19.9 billion.

Meanwhile, government spending in July slightly increased by one percent to P491.2 billion from P486.2 billion a year ago, is due to the higher national tax allotment releases to local government units.

Still, BTr said the July spending was weighed down by the timing of big-ticket disbursements of several government agencies, including the Department of Public Works and Highways, among others.