Gov’t revenue down in July, deficit widens by 57%

MANILA, Aug 30 (Mabuhay) – Government revenue fell in July from a year earlier as non-tax income slowed while expenditures rose on strong public spending.

It was the Duterte administration’s first month in office.

“The total revenues for July declined 5 percent year-on-year owing to reduced non-tax income from the operations of the Bureau of the Treasury and other offices, while expenditures grew 5 percent as a result of strong public spending,” the Department of Finance (DOF) said in an emailed statement.

According to the Finance Department, the budget deficit widened by 57 percent to P50.7 billion from P32.2 billion.

This brought the seven-month fiscal gap to P171.0 billion—still less than half of the year’s P388.87-billion deficit program, but higher than the P18.5-billion shortfall in the same period last year.

Total revenues amounted to P1.27 trillion as of end-July, up 1 percent from the P1.26 trillion.

Excluding the one-off transfer of coconut levy assets in May 2015, revenue growth in the first seven months would have been 6 percent.

Tax collections

Disbursements grew by 12 percent year-on-year to P1.44 trillion from P1.28 trillion.

Tax collections of the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC) – which account for about 90 percent of government revenue, along with other offices – increased by 9 percent to P1.132 trillion in January to July.

“Tax collections of state revenue agencies continued to grow during the first seven months of 2016, helping the government finance its accelerated spending program to further boost the country’s economy and transform it into a more inclusive one,” National Treasurer Roberto Tan said.

DOF data showed BIR collections fell by 1 percent to P117.4 billion, while its seven-month haul grew by 9 percent to P901.0 billion from P824.1 billion.

The BOC saw its year-on-year collections rose by 3 percent to P31 billion.

“This was enough to grow its end-July collections by 6 percent to P221.5 billion,” the DOF said.

Collections from other government agencies declined by 26 percent to P11 billion.

“These collections for the year have so far decreased by more than half to P66.3 billion from P140.6 billion last year,” Tan said.

Treasury collections also declined by 36 percent in July to P9.1 billion, which Tan attributed to lower investment income from the Bond Sinking Fund (BSF) and Securities Stabilization Fund (SSF), as well as the regular deposits of the general fund.

The agency collected P72.8 billion so far this year, down by 10 percent compared with the P81.2 billion last year.

In expenditures, interest payments amounted to P40 billion in July, down 25 percent from P53.1 billion.

Year-to-date, interest payments declined by 7 percent to P193.7 billion from P209.2 billion.

Excluding interest payments, the DOF said the government closed the first seven-months with a primary surplus of P22.7 billion.

While this is lower than last year’s P190.7-billion balance, it indicates “better budget execution.” (MNS)

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