Gov’t incurs lower budget deficit in October

The national government incurred a fiscal deficit in October this year, but it was significantly lower compared to that of the same month a year ago, data from Bureau of the Treasury (BTr) revealed. Based on the Treasury report submitted to Finance Secretary Carlos Dominguez III, the government's budget deficit dropped by 91 percent to P2.3 billion in October from P27 billion in the previous year. During the month, the government's total revenues grew 7 percent to P174.6 billion from P163 billion in October 2015. Of that amount, the Bureaus of Internal Revenue (BIR) and of Customs (BOC) collected P121.9 billion and P33.4 billion, respectively. The BIR posted a 5 percent growth in tax collection compared to P115.8 billion last year, while the BOC registered a 3 percent year-on-year increase in revenues in October from P32.5 billion. Tax collection of other offices, meanwhile, posted a 98 percent jump in October to P2.3 billion from P1.1 billion. Non-tax revenues also improved by over a quarter to P17.1 billion from P13.6 billion a year ago. Of that total, the BTr's income reached P4.9 billion, down 13 percent from P5.6 billion last year, while revenues of other offices jumped 53 percent year-on-year to P12.3 billion from P8 billion. National Treasurer Roberto Tan explained the decline in Treasury's revenue was due to lower income from government deposits with the Bangko Sentral ng Pilipinas and lower dividends on share of stocks from state-owned and -controlled corporations. According to the BTr, the government's expenditures in October amounted to P177 billion, down by 7 percent year-on-year from P190 billion. But setting aside the P16.1 billion in interest payments, the national government recorded a primary surplus of P13.7 billion in October, a reversal of the P10.9 billion primary deficit in the same month last year. In the first 10 months of the year, the government's budget deficit stood at P216 billion, up by more than threefold compared from P52.6 billion in the same period last year, but still well below the P388.87 billion ceiling for 2016. At end-October, total government revenues increased by 3 percent to P1.821 trillion from P1.768 trillion a year before. Government tax collection also improved by 8 percent to P1.629 trillion in the January to October period from P1.505 trillion in the same period last year. Of that amount, the BIR contributed P1.293 trillion, while the BOC raised P321.3 billion. Tax collection of other offices likewise jumped by 9 percent to P15 billion at end-October from P13.8 billion in the same month last year. Revenues generated by the Treasury, meanwhile, declined by 6 percent during the period to P91.1 billion, while other offices' tax collection suffered a 39 percent drop to a combined P100.7 billion. But netting out the one-off transfer of P62.5 billon in coconut levy assets in May last year, the government's 10-month total non-tax and tax revenue collection growth reached 7 percent year-on-year. Meanwhile, government expenditures in January to October accelerated by 12 percent to P2.037 billion from P1.820 trillion in the same period last year. Netting out interest payments, the government ended the first 10-month period with a P49.8 billion primary surplus, lower than the P219.3-billion primary surfeit in the same period last year. The Development Budget Coordination Committee (DBCC) earlier raised the government's budget deficit ceiling to 2.7 percent of gross domestic product (GDP) this year and to 3 percent next year. The deficit ceiling was raised to enable the government to spend big on infrastructure, human capital and social protection, as part of President Duterte's 10-point socioeconomic agenda to sustain high and inclusive growth.

Source: Philippine Information Agency