Budget deficit expands in Feb

THE national government’s budget deficit widened to P116 billion in February as expenditures grew faster than revenues during the month, according to the Bureau of the Treasury (BTr).

Data from the BTr showed on Tuesday that the shortfall was bigger than the P37.6-billion and P14.1-billion fiscal gaps a year and a month ago.

“The deficit further widened in February despite a 6.15-percent year-over-year (YoY) rebound in revenue collection as expenditures grew faster by 37.27 percent YoY,” the BTr said in a statement.

Revenues accelerated to P219.6 billion in the second month of the year from P206.8 billion in February 2020, while expenditures ballooned to P335.5 billion from P244.4 billion a year earlier.

In January, revenues eased by 11.51 percent and spending increased by 1.18 percent.
The February budget deficit brought the year-to-date gap to P130 billion, higher than the P14.6 billion in the first two months of 2020.

The Bureau of Internal Revenue contributed the bulk of revenues with P154.1 billion, a 8.39-percent increase from P142.2 billion a year ago.

The Bureau of Customs raked P47.1 billion, a 5.35-percent rise from P44.8 billion in February 2020. Other offices recorded P1.9 billion in tax revenues.

As a result, total tax revenues surged by 7.32 percent to P203.3 billion.

Meanwhile, nontax earnings fell to P16.3 billion, with the Treasury contributing P4.6 billion, plunging by 22.09 percent year-on-year. Revenues from other offices were up by 1.37 percent to P16.7 billion from last year’s P11.6 billion.

On the other hand, the Treasury said state spending was bigger in February because “both primary expenditures and interest payments (IP) increased for the month.”

The bulk of government expenditures — P304.4 billion — was for primary spending, which improved by 32.87 percent from P229.1 billion a year ago.

Interest payments, amounting to P31.2 billion, accounted for the rest. The Treasury said this amount was “due to coupon payments for the retail treasury bonds issued in 2020 and additional IP for the euro bonds issued in February last year.”

Netting out interest payments, the primary balance amounted a fiscal shortfall of P84.8 billion in February, bringing the two-month tally to a P51.8-billion gap.

This year, the government is projecting the budget deficit to translate to 8.9 percent of the country’s gross domestic product, wider than the 7.63 percent in 2020.