Budget deficit drops to P146.8 B in May

Published June 23, 2022, 12:32 PM

by Lee C. Chipongian

The Philippines’ budget deficit in May dropped to P146.8 billion, down by P53.5 billion or 26.76 percent lower against same month last year at P200.3 billion, on the back of improved revenue collections in the last year of the Duterte administration.

This brought the first five-month deficit also to drop to P458.7 billion, about P107.5 billion or 18.99 percent lower from same time last year of P566.2 billion, based on the latest Bureau of the Treasury (BTr) data released on Thursday, June 23.

(Photo by Ali Vicoy)

In May, revenue collection posted a double-digit growth of 18.91 percent while government expenditures decreased by 1.10 percent, resulting in a lower budget gap.

Total revenues went up to P304.9 billion for the month versus P256.4 billion last year. As of end-May, revenues totalled P1.437 trillion, up by 15.46 percent year-on-year or by P192.4 billion.

The government said P1.289 trillion or 90 percent of the total revenues were tax collections while 10 percent or P147.6 billion are non-tax revenues.

The two tax collection bureaus also performed better in the last year of the Duterte administration. For instance, the Bureau of Internal Revenue’s (BIR) net collections in May was up by 17.91 percent or by P32.9 billion to P216.6 billion. This brought its total collections to P959 billion for the first five months, up by 9.92 percent or by P86.6 billion.

Meantime, the Bureau of Customs (BOC) posted its highest collection for the year at P66.3 billion in May, an increase of 36.35 percent or P17.7 billion. As of end-May, BOC collected P320.5 billion, up by 28.42 percent or by P70.9 billion.

However, BTr collections dipped in May, it amounted to P8.9 billion. It was down by 28.22 percent or by P3.5 billion due to lower dividend remittances, it said. Still, it noted that its five-month collection was up by 37.08 percent or by P22.5 billion to P83.4 billion.

Other collections from other offices or other non-tax sources such as privatization proceeds, fees and charges, increased by 8.35 percent year-on-year to P10.4 billion in May, and to P64.2 billion cumulative which was 18.49 percent higher from 2021.

As for expenditures, the BTr said the National Government spent lower as of end-May or 1.10 percent less compared to same period in 2021. Expenditures totaled P451.7 billion or P5 billion lower compared to P456.7 billion last year.

Disbursements for the first five months totalled P1.896 trillion which was 4.69 percent or P84.9 billion more compared to 2021.

In the Duterte government’s last budget deficit report, it had a primary spending or net of interest payments of P417.9 billion in May, lower by 2.32 percent or P9.9 billion. Cumulatively, primary expenditures as of end-May was at P1.675 trillion, up by 2.64 percent or P43.1 billion.

Meantime, total interest payments in May increased by 16.93 percent or by P4.9 billion to P33.8 billion. This led to a five-month total of P220.5 billion which was more than P178.6 billion same period last year.

“Excluding interest payments from expenditures, NG achieved a P113 billion primary deficit for the month,” said BTr. The primary deficit was 34.09 percent or P58.4 billion lower compared to what was reported in 2021.

BTr also said that the five-month primary budget deficit of P238.2 billion was also lower by 38.54 percent or P149.4 billion from P387.6 billion last year.