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The national government recorded a narrower budget deficit in the first quarter of the year at P74 billion, 17.97 percent less than P90.2 billion last year, as government spending fell below target, according to showed the latest data from the Treasury Office.
The accumulated deficit of P74 billion was also lower than the P332.9 billion program by 77.76 percent.
Relative to GDP, the deficit for the first quarter of 2020 stood at 1.65 percent, decreasing from the deficit / GDP ratio of 2.04 percent last year.
Government spending at the end of March only reached P849.2 billion, falling 14.48 percent below the 993 billion program for the period due to delays in implementing the program with improved community quarantine and payments of Net interest and loans below schedule. .
However, government spending for the first quarter of the year still exceeded P778 billion last year.
On the other hand, revenues for the first three months reached P775.2 billion, increasing 12.72 percent from P687.7 billion recorded in the same period in 2019. The government also exceeded its revenue target of P660.1 billion for the period at 17.43 percent.
A budget deficit occurs when expenses exceed income.
In March alone, the national government incurred a larger budget deficit for this year at P59.5 billion, reflecting a 1.83 percent increase from P58.4 billion in 2019.
“The largest fiscal gap is due to the largest nominal increase in public spending compared to revenue growth,” the Treasury said in a statement Monday.
Of the P775.2 billion revenue at the end of March, 80 percent or P620.8 billion came from tax revenue, while 20 percent or P154.4 billion came from non-tax revenue.
Non-tax collections for the period more than doubled from last year due to the early release of dividends from government-controlled corporations (GOCC) in line with the implementation of the Bayanihan to heal as a single law.
Revenue raised by the Treasury Office soared to P111.2 billion, three times more compared to its achievement in the first quarter of last year. To date, the Treasury has already failed to meet its annual target of P82.3 billion, mainly due to higher remittances of dividends and interest on advances to GOCC that have exceeded the annual targets by P63.4 billion and P7.4 billion , respectively.
Revenue from other sources, including revenue from privatizations and fees and charges, increased 5.60 percent with real collections of P19.6 billion.
Regarding tax revenues, the collection of the Internal Revenue Office (BIR) was flat at P468.8 billion at the end of March from P468.2 billion in the same period in 2019 due to the imposition of community quarantine improved throughout Luzon in mid-March in response to the Covid-19 pandemic. Despite this, the BIR collection for the first quarter of 2020 was even higher than its P454 billion target for the period.
For its part, the tax collection of the Customs Office (BOC) Q1 increased to P145.3 billion from P141.9 billion in 2019. This, despite the fact that BOC collections fell to P44.6 billion in March of P49.3 billion in the same month in 2019.
In terms of public spending, operating expenses comprised most of P729.3 billion at the end of March, rising 8.82 percent from P670.2 billion in 2019. This is also below the P854.2 billion program million for the period.
Interest payments for the first quarter of the year also rose to P119.9 billion from P107.8 billion in 2019.
For March, interest payments also grew 17.96 percent year-over-year to P43.1 billion from P36.6 billion in the same month in 2019 due to coupon payments for five-year retail treasury bonds issued in 2019, and the time of payment of the 25-year fixed rate Treasury Bonds that were paid on April 1, 2019 (instead of March 30), due to an official holiday.
At the end of March, the government’s accumulated primary balance remained in surplus at P45.9 billion and was more than double the P17.5 billion registered a year ago.
