July budget deficit narrows to near 5-yr low
A modest increase in government spending narrowed the Philippines’ budget deficit in July to its smallest level in nearly five years, keeping the shortfall within the Marcos administration’s target.
The state continued to spend more than it collected after recording a fiscal deficit of P18.9 billion, albeit smaller by 34.42 percent compared with a year ago, latest data from the Bureau of the Treasury showed.
The July reading was the narrowest budget gap since January 2021, when the shortfall stood at P14.1 billion.
This brought the seven-month deficit to P784.4 billion, 22.04 percent bigger than last year’s level. But this is still far from the P1.56 trillion limit set by the Marcos administration for this year, which is equivalent to 5.5 percent of gross domestic product.
Broken down, the government spent P491.2 billion in July, edging up by 1.02 percent.
The Treasury said the rise in spending was fueled largely by higher transfers to local governments and the release of the Bangsamoro Autonomous Region’s share of national tax revenues. Even so, expenditures were weighed down by the timing of big-ticket releases for banner programs of key agencies. Still, cumulative spending rose 8.22 percent to P3.52 trillion.
Revenue growth outstripped the modest increase in disbursement, with collection climbing by 3.26 percent to P472.3 billion in July. The Bureau of Internal Revenue saw its receipts rise by 4.83 percent to P335.3 billion, while the Bureau of Customs collected P85.2 billion, up by 6 percent.
In the first seven months, total revenues grew by 4.82 percent to P2.73 trillion.
The Marcos administration is planning to borrow P2.6 trillion from creditors at home and abroad to plug its budget deficit.
