May deficit narrows to P145.2-B as revenues surge

The national government’s budget deficit in May narrowed to P145.2 billion, driven by strong revenue growth and moderated spending, according to data released by the Bureau of the Treasury (BTr) on Thursday.

This marks an improvement from the P174.9 billion deficit recorded in the same month last year.

Revenue collections in May reached P433.1 billion, up by 13.35 percent from P382.1 billion in 2023, fueled by solid gains in both tax and non-tax revenues. Tax revenues rose by 10.49 percent, totaling P1.752 trillion, reflecting the government’s continued push for better revenue generation.

Collections by the Bureau of Internal Revenue (BIR) climbed 10.71 percent to P242.7 billion. “This increase was primarily driven by corporate income tax (CIT), followed by personal income tax (PIT), excise tax on tobacco products, taxes on government securities, and taxes on banks and financial institutions,” the BTr said.

“The Bureau’s intensified collection effort, strengthened campaign against fake transactions, ongoing digital transformation, and continued crackdown on illicit tobacco trade have contributed to the improved performance for the said month.”

Meanwhile, the Bureau of Customs (BOC) collected P75.7 billion, a 6.9 percent drop attributed to reduced tariffs on rice and battery-powered electric vehicles. “Nevertheless, BOC remains committed to enhancing its revenue strategies and identifying new measures to offset these effects,” the BTr noted.

Non-tax revenues rose significantly by 40.93 percent to P110.2 billion, driven by higher dividend remittances from government-owned and -controlled corporations (GOCCs), reflecting improved financial performance and greater compliance.

Government spending in May reached P578.2 billion, a 3.81 percent increase from last year’s P557 billion. The rise in expenditures was mainly due to higher interest payments, tax allotments to local government units, and block grants to the Bangsamoro Autonomous Region in Muslim Mindanao. Spending also reflected the implementation of the second tranche of salary increases for qualified civilian government employees under Executive Order 642.

From January to May, the government recorded a cumulative budget deficit of P523.9 billion, up by 29 percent, as it ramped up infrastructure investments and social programs to promote inclusive growth.

Despite the higher deficit, the BTr emphasized that the government remains on track to meet its full-year target through prudent fiscal management and efficient resource use.

Revenue collections for the five-month period rose 5.41 percent to P1.953 trillion, while total expenditures grew 9.71 percent to P2.477 trillion.