Philippines: Fiscal balance swings to deficit in February

MANILA, Philippines – The national government’s fiscal balance swung back to a deficit last February as revenue generation failed to offset spending during the period, data from the Bureau of the Treasury (BTr) showed.

In its latest cash operation report, the BTr said the national government incurred a fiscal deficit of P23.7 billion in February, a reversal of the P2.2-billion surplus generated in January.

The latest deficit, however was 31 percent lower than the P34.6 billion in shortfall incurred in the same month in 2016.

This brought the fiscal deficit for the first two months to P21.5 billion, also lower than the P38.1 billion posted in the same period last year.

A deficit occurs when government’s expenditures exceed the revenue that it generates.

Based on Treasury data, total revenue for February amounted to P151.8 billion, nine percent higher than the P139 billion recorded in the same period last year.

For the first two months, revenue amounted to P352.2 billion, 10 percent up from year-ago levels on the back of reforms set by the Bureaus of Internal Revenue and Customs, as well as the general uptick in economic activity for the period.

The bulk of revenue during the period was contributed by tax revenues from the BIR and BOC.

BIR collections rose 12 percent to P105.9 billion in February. The BOC also posted a double digit growth of 14 percent, with revenue amounting to P30.9 billion.

On the other hand, non-tax revenues during the period declined 13 percent to P13 billion.

BTr income declined eight percent to P5.3 billion due to lower income from bond sinking fund and securities stabilization fund investments, given diminished asset base and lower dividends on the shareholdings of the national government.

Meanwhile, disbursements in February amounted to P175.6 billion, one percent higher than last year’s P173.6 billion. About 14 percent of expenditures went to interest payments, the BTr said.