Budget deficit widens despite higher revenues
At end-July 2024
The national government's budget deficit widened in the first seven months of the year, despite revenues growing at a faster rate than public spending, data from the Department of Finance (DOF) showed.
During the DOF budget deliberations on Tuesday, Aug. 27, Finance Secretary Ralph G. Recto reported that the government’s fiscal deficit increased seven percent to P642.8 billion from January to July from P599.5 billion in the same period last year.
The budget deficit for the first seven months comprised 43.3 percent of the Marcos administration’s full-year ceiling of P1.484 trillion, equating to 5.6 percent of the economy.
According to the data presented by Recto, revenue growth reached 14.8 percent at end-July, slightly outpacing the 13.2 percent increase in expenditures.
Total expenditures stood at P3.25 trillion from January to July, higher compared to P2.87 trillion spent in the same period last year.
On the other hand, the government collected P2.61 trillion in revenues, up by about 15 percent from P2.27 trillion a year earlier.
Most the revenues came from the Bureau of Internal Revenue with P1.68 trillion, 13 percent higher compared to the P1.5 trillion collected in the same period last year, and Bureau of Customs with P535.9 billion, up six percent from P506.5 billion last year.
“Non-tax revenues recorded a 44.5 percent growth, totaling 368.80 billion pesos. The dividends from our GOCCs contributed much to this increase,” Recto said.
GOCCs, or government-owned and controlled corporations, contributed around P185 billion in revenues, up by 65 percent from P112 billion collected last year
The Bureau of the Treasury also increased its collections to P183.8 billion during the period, 28 percent higher than the P143.8 billion a year ago.
“This strong revenue performance placed us among Asia’s top revenue-to-GDP ratios at 17.1 percent for the first half of the year. And this is above our full-year target of 16.1 percent,” the DOF chief said.
He assured that the Marcos administration is on track to meet the fiscal program for the year, citing the digitalization programs of its major tax revenue agencies.
For this year, the government aims to collect around P4.27 trillion in revenues, representing 16.12 percent of the country’s gross domestic product. Meanwhile, it set the budget deficit ceiling of P1.48 trillion for this year.
In June alone, the government’s budget deficit was P28.89 billion.