PH gov't fiscal balance at P478.8-B deficit in Q1 2025 — Treasury

The Philippine government’s fiscal balance continued to stand at a deficit in the three months of 2025 as the growth in state spending outpaced the increase in collections.

Data released by the Bureau of the Treasury (BTr) showed that the national government yielded a budget deficit of P478.8 billion in January to March, up 75.62% from P272.6 billion in the same period last year.

The fiscal outturn was on the back of higher public spending of P1.477 trillion versus a state collection of P998.2 billion in the first quarter of the tear.

The January to March fiscal balance still falls within the government’s P1.5-trillion budget deficit ceiling for 2025, according to the Treasury.

Revenues

Total government revenues for the first three months of the year grew by 6.90% from P933.7 billion year-on-year “due to the strong performance of the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC).”

The bulk of the total revenues during the period were tax collections which stood at P931.5 billion, up 13.55% from P820.4 billion a year earlier.

In particular, the BIR recorded a 16.67% growth in tax collections, reaching P690.4 billion “due to higher collections from personal income tax (PIT), corporate income tax (CIT), percentage taxes, value-added tax (VAT), excise taxes, documentary stamp tax, and percentage taxes.”

Meanwhile, theBOC saw a 5.72% increase in collection to P231.4 billion, “due to higher VAT from non-oil imports and excise tax collections from oil and non-oil imports.”

The Treasury said the revenue agencies’ sustained growth for the third consecutive month was “driven by their ongoing revenue enhancement measures, particularly the intensified campaign against the use of fake receipts, intensified crackdown on illicit trade, digitalization, and improvements in tax payment facilitation, among other initiatives.”

Non-tax revenues, on the other hand, accounted for P66.7 billion of the revenues during the period, down 41.21%, “due to timing as 18 government owned and  controlled corporations (GOCCs) remitted P28.23 billion in early first quarter dividends back in 2024 compared with only three GOCCs with P27 million early dividends for the current year.”

“Nevertheless, non-tax revenues are expected to improve in the succeeding months, with dividends from the GOCCs set to be remitted to the National Treasury starting May 2025,” the BTr said.

Expenditures

State expenditures amounted to P1.5 trillion, nearly a quarter of the P6.2-trillion 2025 full-year disbursement program.

Government spending during the first quarter was higher by 22.43% than the P1.2 trillion expenditures in the same period in 2024.

“The strong spending performance can be attributed to the higher disbursements recorded in the Department of Public Works and Highways (DPWH) for its road infrastructure program and regular operating requirements, and in the Department of Social Welfare and Development (DSWD) for its various protective services programs,” the Treasury said.

“Significant fiscal transfers to local government units were also made that include their National Tax Allotment shares, the Annual Block Grant to the Bangsamoro Au ton omou s Region in Muslim Mindanao, as well as Local Government Support Fund (financial assistance) releases,” it added.

The BTr said the transfer of P32.8 billion to the Coconut Farmers and Industry Trust Fund in accordance with the mandated schedule of capitalization contributed to the larger spending outturn. — RSJ, GMA Integrated News