Nat’l gov’t swings to budget surplus of P1.8B in June

The national government’s fiscal balance reverted to a surplus in June as state revenues exceeded spending during the period.

Data released by the Bureau of the Treasury (BTr) showed the national government posted a budget surplus of P1.8 billion last month from P41.8 billion deficit recorded in the same month in 2019.

“The fiscal surplus was driven by 50.06% growth in government receipts as the 2019 income taxes came in and the resumption of some economic activities, outpacing the 26.65% expansion in government spending,” the Treasury noted.

For January to June, the fiscal position stood at a deficit of P560.4 billion, 25.38% lower than the P751.1-billion target for the period. Year-on-year, the budget deficit in the first six months of 2020 is still wider than P42.6-billion deficit posted in 2019.

Revenues

In June, the government’s revenue collection amounted to P351 billion, up 50.06% or P117.1 billion from P233.9 billion a year earlier.

The lion’s share P325.4 billion or 93% of the total revenues came from taxes which accelerated by 54.56% while the remaining 7% or P25.6 billion were sourced from non-tax revenues.

Year-to-date, revenues totaled P1.453 trillion, down 6.09% or P94.2 billion year-over-year.

This, however, is 0.12% or P1.7 billion higher versus the adjusted P1.451 trillion target for the January to June period.

Bulk of the collections came from the Bureau of Internal Revenue (BIR) which significantly improved its take by 79.10 % year-on-year, reaching P282.7 billion and marking a recovery from three consecutive months’ contraction.

BIR’s strong performance for the period was attributed to the collection of the 2019 income tax dues during the month as well as the resumption of economic activities due to the easing of some quarantine restrictions, according to the Treasury.

This enabled the taxman to surpass its revised target of P933.5 billion for the first semester by 2.45% but still lagged behind last year’s actual revenue of P1.066 trillion by 10.31% or P109.9 billion.

The Bureau of Customs (BOC), meanwhile, collected P42.6 billion for June, down 16.97% or P8.7 billion lower than it did in the same period in 2019 due to the adverse impact of the COVID-19 outbreak.

The BOC’s total midyear collection narrowed to P253.1 billion, down 16.47% from last year’s six-month total and 0.45% short of the P254.2 billion adjusted goal.

The Bureau of the Treasury (BTr) generated a total income of P11.3 billion for June, beating last year’s level by 5.85%.

Collections for the month were buoyed by higher remittance of interest on advances from government owned and controlled companies and corporations (GOCCs) and dividends on shares of stocks held by the government which offset the decline in national government share from Philippine Amusement and Gaming Corp (PAGCOR) income.

The Treasury’s income as of end-June amounted to P183.2 billion. It has more than double the amount collected for the first semester of 2019 and has outperformed the original full-year target of P82.3 billion by P101.0 billion.

Revenue from other offices or other non-tax including privatization proceeds and fees and charges went up by 12.64% year-on-year to P14.3 billion in June which includes the reversion of the P5.0 billion unutilized fund from the Small Business Wage Subsidy (SBWS) program.

The year-to-date collection of P53.7 billion, on the other hand, decreased by 31.95%, missing the estimate by 33.53% or P27.7 billion attributed to the effect of the nationwide lockdown on the operations of various national government collecting agencies, according to the BTr.

Expenditures

The national government’s disbursements for the month increased to P349.2 billion, up 26.65% over last year’s level of P275.7 billion largely on account of the subsidies to the Philippine Health Insurance Corporation (PHIC) and National Housing Authority (NHA).

This brought the cumulative expenditures to P2,013.7 billion for the six-month period, up 26.63% or P423.5 billion higher than the 2019 figure while the remaining 8.58% or P188.9 billion within the revised program of P2,202.6 billion.

Primary spending, net of interest payment, in June increased by 30.42% over comparable figures a year ago, settling at P321.7 billion.

Total primary expenditures for the first half of 2020 similarly grew by 29.50% year-on-year to P1,826 trillion attributed mainly to the implementation of the second tranche of the Social Amelioration Program (SAP), which is still currently ongoing, but missed the P1.995 trillion programmed by 8.48%.

Total interest payment for June dropped by 5.28% to P27.6 billion compared to the P29.1 billion recorded in the previous year primarily due to maturities of government global bonds last year.

For January to June, interest payments increased by 4.22% to P187.7 billion, but was still 17.03% lower against the original program of P226.2 billion, generating savings of P38.5 billion, the Treasury said.

As a percentage of revenue and expenditures, interest payments as of-end June accounted for 12.91% and 9.32% compared to previous year levels of 11.64% and 11.32%, respectively.—AOL, GMA News