NG reverts to fiscal surplus in June

Published July 22, 2020, 10:00 PM

by Chino S. Leyco

Revenue collection rebounds

The national government recorded a budget surplus last month due to collection of the delayed income tax payments and the resumption of some economic activities amid easing lockdowns, the Bureau of the Treasury said. 

The Duterte administration reverted to a P1.8 billion fiscal surplus in June this year from a P41.8 billion deficit incurred in the same month last year, data from the treasury bureau showed yesterday.

 “The fiscal surplus was driven by 50.06 percent growth in government receipts as the 2019 income taxes came in and the resumption of some economic activities,” the treasury said in a statement.

 Revenue collection jumped to P351 billion during month, up from P233.9 billion a year ago. Of that amount, 93 percent came from taxes, while the remaining seven percent were sourced from non-tax income.

 The treasury said that bulk of the revenues came from the Bureau of Internal Revenue (BIR), which significantly improved its tax haul in June by 79 percent year-on-year to P282.7 billion, marking a recovery from its three consecutive months’ contraction.

“BIR’s strong performance for the period was attributed to the collection of the 2019 income tax dues during the month as well as the resumption of economic activities due to the easing of some quarantine restrictions,” the treasury said.

But the Bureau of Customs, however, collected only P42.6 billion in June, lower by 17 percent compared with P51.3 billion a year ago.

The treasury said the decline in Customs revenues was due to the “adverse impact of the COVID-19 outbreak.”

Public spending, on the other hand, amounted to P349.2 billion in June, higher by 26 percent compared with P275.7 billion in the same month last year.

 “[This] is largely on account of the subsidies to the Philippine Health Insurance Corp. (PHIC) and National Housing Authority (NHA),” the treasury said.

The June fiscal performance brought the national government’s first semester budget deficit to P560.4 billion, significantly higher by 1,214 percent from only P42.6 billion in the same period in 2019.

The actual end-June fiscal deficit, however, was below the Duterte Administration’s revised ceiling for the period of P751.1 billion by 25 percent.

Government expenditures were also lower than expected in the first-half by 8.5 percent to P2.013 trillion, but higher by 26 percent compared with P1.590 trillion a year before.
Revenues, on the other hand, were slightly above the target of P1.451 trillion by 0.12 percent to P1.453 trillion in January to June, but down by six percent from P1.381 trillion last year.

At end-June, BIR collections declined by 10 percent year-on-year to P956.4 billion from P1.066 trillion, but stronger than the government’s new target of P933.5 bilious.

 “BIR’s strong performance [in June]… enabled the agency to surpass its revised program of P933.5 billion for the first semester by 2.45 percent,” the treasury said.