H1 DEFICIT HITS P560.4B ON LOCKDOWN IMPACT
THE national government’s budget deficit for the first half of the year soared to P560.4 billion as the Covid19-induced lockdown caused the drop in state revenues and the hike in government spending.
The six-month budget gap, which nearly matched the entire 2019 budget deficit of P660.2 billion, also represented a 13-fold increase from P42.6 billion as of end-june last year.
This year’s first-semester deficit also fell short by 25.38 percent of the government’s revised program of P751.1 billion.
Government revenues slid by 6.09 percent to P1.453 trillion from P1.548 trillion a year ago, while state expenditures jumped by 26.63 percent to P2.01 trillion from P1.59 trillion in the same period in 2019, latest data from the cash operations report released by the Bureau of the Treasury showed.
For June alone, the government recorded a P1.8-billion budget surplus, reversing the P41.8-billion budget deficit it posted in the same month last year.
“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, outpacing the 26.65-percent expansion in government spending,” the Treasury said in a statement.
The last time that the government had a budget surplus for June was in 2008 when it posted P769 million.
Revenue collection for the month surged to P351 billion from last year’s P233.9 billion.
Tax revenues spiked by 54.56 percent to P325.4 billion from only P210.5 billion in the same month in 2019.
Significantly contributing to the increase in state revenues was the Bureau of Internal Revenue (BIR), which saw a 79.10-percent year-on-year increase in its tax take to P282.7 billion from last year’s P157.8 billion.
For its part, the Bureau of Customs collected P42.6 billion in June, down by 16.97 percent from P51.3 billion in the same month last year.
On the other hand, nontax revenues rose by 9.53 percent to P25.6 billion from P23.3 billion in June last year, as revenues from other offices, including privatization proceeds, went up by 12.64 percent to P14.3 billion in June from last year’s P12.7 billion.
For the month, disbursements also grew 26.65 percent to P349.2 billion from last year’s P275.7 billion, mainly due to subsidies to the Philippine Health Insurance Corporation and the National Housing Authority.
Of this amount, P321.7 billion was for primary spending, which was net of interest payments.
The government’s economic team projects the country’s budget deficit this year to widen to P1.613 trillion, or 8.4 percent of GDP. They also said earlier they are willing to allow a stimulus package that would not breach their deficit target of as much as 9 percent of GDP this year.