February budget gap narrows to P 37.6B

The national government’s budget deficit narrowed to P37.6 billion in February as spending contracted year-on-year due to the seasonality of disbursement of local governments’ internal revenue allotment (IRA).

February’s deficit was only a little over half of the P76.4 billion posted a year ago as expenditures that month dropped 12.2 percent to P244.4 billion from P278.5 billion last year, the latest Bureau of the Treasury data released Monday showed.

In a report, the Treasury attributed the decline in disbursements last February to “the base effect of IRA of local government units for January 2019 which was released in February last year, as well as lower interest payments.”

To recall, the 2019 national budget did not pass on time such that the government used reenacted appropriations at the start of last year, which led to delayed fund releases.

Net of the IRA base effect and interest payments, so-called productive spending rose 6 percent year-on-year, the Treasury said,

As for revenues, the government’s combined tax and non-tax take inched up by 2.4 percent to P206.8 billion in February from P202.1 billion a year ago.

The Bureau of Internal Revenue’s collection rose 4.8 percent year-on-year to P142.2 billion, while the Bureau of Customs’ (BOC) haul of import duties and other taxes increased by 1.3 percent to P44.8 billion.

“The slow growth [of BOC collections] for the month was mainly due to the slowdown of importation from China amid the COVID-19,” the Treasury explained.

Meanwhile, non-tax revenues declined 13 percent year-on-year to P17 billion mainly as the dividends remitted by state-run corporations to the Treasury were smaller than a year ago.

During the first two months, the cumulative budget deficit of P14.6 billion was also narrower by 54.3 percent compared to the P31.8 billion in end-February last year.

From January to February, the government collected P501.5 billion in tax and non-tax revenues, up 9.3 percent year-on-year.

The amount spent on public goods and services increased by 5.2 percent to P516 billion as of February. INQ