Gov’t budget shortfall hits two-month high
The government’s budget deficit widened to a two-month high in August, as revenues fell more sharply than expenditures, which slid to their lowest level in six months.
The Marcos administration incurred a fiscal shortfall of P84.8 billion, 56 percent bigger compared with the level a year ago, the Bureau of the Treasury reported on Wednesday. Data showed this was the widest budget gap since June, when the deficit amounted to P242 billion.
The figures underscore the persistent mismatch between revenue collection and government outlays, prompting the government to continue borrowing money from local and foreign creditors to plug the budget hole.
From January to August, the fiscal gap reached P869 billion, up nearly a quarter from last year, though still only a little more than half of the revised P1.56-trillion deficit ceiling set for 2025.
For the Treasury, the shortfall remained “well-managed” and “on track” with the target.
Government revenues fell to a two-month low in August, contracting 8.8 percent to P352.5 billion. That pulled year-to-date collections to P3.1 trillion, still 3 percent higher than a year earlier.
The Bureau of Internal Revenue, the government’s main tax agency, collected P250.1 billion in August, up 5 percent. Since January, it has generated P2.1 trillion, an 11 percent increase fueled by gains in corporate and personal income taxes, value-added tax, excise taxes on tobacco, percentage taxes on financial institutions and documentary stamp duties.
The Bureau of Customs, by contrast, posted a 1.4-percent drop in August revenues to P77.4 billion. Its collections since the start of the year reached P621 billion, up just 1.1 percent, amid lower tariffs on rice and electric vehicles and easing global inflation, which eroded the base for import duties.
Meanwhile, spending edged down by 0.74 percent to P437.3 billion, the lowest since February’s P423 billion. This brought the eighth-month expenditures to P3.95 trillion, growing by 7.15 percent.
This year, the government plans to borrow P2.6 trillion from lenders to plug its budget shortfall, which is estimated to reach 5.5 percent of gross domestic product. The drive is expected to push the debt stock to P17.36 trillion by year’s end.
