Budget deficit eases in July as revenues outpace spending

The national government’s budget deficit eased in July as revenue growth outpaced spending, the Bureau of the Treasury (BTr) reported Thursday.

The shortfall dropped 34.42 percent to P18.9 billion from P28.8 billion a year earlier, as total revenues rose 3.26 percent to P472.3 billion, driven mainly by higher tax collections.

The Bureau of Internal Revenue (BIR) collected P335 billion, up 4.8 percent on stronger receipts from corporate and personal income taxes, taxes on government securities, excise taxes on tobacco, percentage tax on banks, and documentary stamp tax. 

The Bureau of Customs (BOC) also posted a 6 percent increase to P85.2 billion, boosted by gains in value-added and excise tax collections.

Non-tax revenues fell 9.66 percent to P49.3 billion but were cushioned by strong BTr income, which surged 82.42 percent to P36.3 billion on the back of higher dividends, interest income from government deposits, and profit shares from the Manila International Airport Authority.

Government spending rose modestly to P491.2 billion from P486.2 billion a year ago, partly reflecting higher allotments to local governments, the block grant to the Bangsamoro region, interest payments, and personnel expenses. 

Disbursements were tempered by the timing of major releases for programs of the Departments of Public Works and Highways, Social Welfare and Development, and National Defense.

From January to July, the deficit reached P784.4 billion, in line with the revised full-year ceiling of P1.56 trillion. Revenues for the seven-month period hit P2.7 trillion, or 60.45 percent of the revised P4.52 trillion program, while expenditures climbed to P3.52 trillion, up 8.22 percent.

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