Virus spending widens fiscal gap

For June alone, the NG reverted to a P1.8 billion budget surplus versus the P41.8 billion deficit in the same month a year-ago

The national government’s (NG) heightened spending in response to the coronavirus disease pandemic for the first semester resulted to a wider budget deficit of P560.4 billion, which represented a huge spike from the P42.6 billion deficit recorded in the first six months of last year.

The government recently revised the deficit target this year to P751.1 billion.

For June alone, the NG reverted to a P1.8 billion budget surplus versus the P41.8 billion deficit in the same month a year-ago as the 2019 income taxes and the resumption of economic activities outpaced the 26.65 percent government spending.

Expenditures in June grew 26.65 percent to P349.2 billion from the posted P275.7 billion a year ago owing primarily to the subsidies provided to the Philippine Health Insurance Corp. and the National Housing Authority.

On aggregate, NG disbursements for the first half settled at P2.01 trillion or 26.63 percent higher than the P1.59 trillion in the same period in 2019.

Total interest payments in June was lower by 5.28 percent to only P27.6 billion versus the recorded P29.1 billion in the same month year-ago owing to the maturities of ROP global bonds last year.

Revenue recovers

Following a decline in revenues in the previous months, NG collections rose to P351 billion in June, boasting a double-digit growth of 50.06 percent from last year’s P233.9 billion.

Of the total stock, bulk or 93 percent came from tax sources while the remaining seven percent were sourced from non-tax revenues.

Although lower by 6.09 percent year-on-year, NG revenues for the first half amounting to P1.453 trillion was higher than the adjusted P1.451 trillion program.

BIR still top revenue source

Still, the Bureau of Internal Revenue contributed the largest chunk of the collections with P956.4 billion in the first six months of 2020, allowing the agency to surpass its P933.5 billion program for the period.