Fiscal gap narrows as revenues surge

The national government posted a slightly narrower budget deficit in February, supported by stronger revenue collections that outpaced spending growth, according to the Bureau of the Treasury (BTr).

Latest cash operations data showed the deficit eased to ₱171.2 billion in February, marginally lower than the ₱171.4 billion recorded in the same month last year. This brought the year-to-date fiscal gap down sharply to ₱5.8 billion, reflecting a 94.3-percent improvement compared with the ₱103.1 billion deficit in the January–February 2025 period.

Revenues for February jumped 43.52 percent to ₱361.3 billion from ₱251.8 billion a year earlier, lifting total collections for the first two months of the year to ₱830.2 billion—up 15.48 percent from the same period last year.

Tax collections accounted for the bulk of inflows, reaching ₱692.6 billion, slightly higher than the previous year’s ₱671.9 billion. Non-tax revenues also surged to ₱137.6 billion from ₱47 billion, making up about 16.57 percent of total receipts.

The Bureau of Internal Revenue collected ₱531.9 billion, reflecting improved taxpayer compliance, while the Bureau of Customs posted ₱154.6 billion in revenues, aided by stronger enforcement efforts and currency movements.

On the spending side, government expenditures rose 25.83 percent to ₱532.5 billion in February from ₱423.2 billion a year earlier, driven largely by the release of national tax allotments, the Bangsamoro block grant, and tobacco excise tax shares for local governments.

For January to February, total expenditures reached ₱836 billion, up 1.70 percent from the previous year.

Finance Secretary Frederick Go said the improved fiscal position gives the government more room to respond to external pressures, including the impact of geopolitical tensions in the Middle East.

“This fiscal buffer allows us space to provide timely, targeted, and managed subsidies to help those most affected in our country by the Middle East event,” Go said.

He added that the stronger revenue performance allows the government to maintain fiscal discipline while ensuring continued support for affected sectors and sustaining economic stability amid global uncertainty.