The national government’s budget deficit narrowed in July due to the double-digit growth in revenues, the Bureau of the Treasury (BTr) reported yesterday.
In a statement, the BTr said the budget deficit for July 2024 declined by 39.67 percent year-on-year to P28.8 billion, driven by faster revenue growth of 11.09 percent compared to the 5.8 percent increase in expenditures.
The resulting year-to-date budget gap stood at P642.8 billion, up by 7.21 percent from the same period last year.
Revenue collections in July amounted to P457.4 billion, up 11.09 percent year-on-year.
Thus, the P2.6 trillion cumulative revenue for 2024 surpassed the P2.3 trillion raised in the same seven-month period in 2023 by 14.75 percent.
The Bureau of Internal Revenue (BIR) achieved 17.09 percent year-on-year growth in its July collection amounting to P319.8 billion.
The agency’s P1.7 trillion total collections as of end-July also grew by 12.7 percent compared to last year’s collection of P1.5 trillion.
The BTr said the annual growth was due to higher collections of value-added tax (VAT), income taxes, other domestic taxes and percentage taxes.
The growth in VAT collection was partly attributed to base effects as collections last year were lower by around two months’ worth of VAT collection with the shift from monthly to quarterly filing of VAT payments as mandated by the Tax Reform for Acceleration and Inclusion Law.
Meanwhile, the Bureau of Customs’ (BOC) collection for the month was recorded at P80.4 billion, registering year-on-year growth of 9.99 percent.
The BOC’s aggregate collection for the first seven months of the year reached P535.9 billion, 5.8 percent higher than the January to July 2023 figure.
The year-on-year growth in BOC revenue was due to higher collections from VAT, import duties and excise taxes, the BTr said.
The positive revenue performance was also driven by peso depreciation, higher value and volume of imports and higher international crude oil prices when compared with the same period last year.
Income collected and generated by the BTr contracted to P19.9 billion in July from P50.8 billion a year ago.
The decrease was primarily due to the Bangko Sentral ng Pilipinas’ one-off remittance of P31.9 billion last year, as well as reduced income from BTr-managed funds and national government deposits.
Nonetheless, BTr’s cumulative 2024 income of P183.8 billion has already surpassed the previous year’s performance for the same period by 27.81 percent.
The agency said that this strong performance was due to higher dividend remittances, interest on advances from government-owned and -controlled corporations, and the national government’s share from the Philippine Amusement and Gaming Corp’s income.
Meanwhile, July disbursements reached P486.2 billion and were 5.8 percent higher than what was spent in 2023 partly due to the higher National Tax Allotment share of local government units, the BTr said.
The July outturn contributed to a higher year-to-date expenditure of P3.2 trillion, reflecting a 13.17 percent annual increase in disbursements.
Primary expenditures net of interest payments in July reached P406.8 billion, representing a 2.73 percent increase over last year.
Total primary expenditures for the seven-month period amounted to P2.8 trillion.
This similarly outperformed the P2.5 trillion posted in the corresponding period a year ago.
Meanwhile, in a separate statement, Department of Budget and Management (DBM) secretary Amenah Pangandaman called on departments and agencies to fully utilize their infrastructure budgets.
“I urge all national government agencies with infrastructure projects to aim for 100 percent budget utilization so that we will sooner see the fruits of our Build Better More Infrastructure Program while we continue to hit our GDP targets,” Pangandaman said.
The budget chief expressed confidence that the government’s infrastructure spending will boost the country’s GDP growth in the third quarter of 2024.
Infrastructure spending reached P720.5 billion at the end of June 2024, expanding by 18.4 percent compared to the same period last year.
This is equivalent to 5.7 percent of GDP and well within the five to six percent target of the national government under the Medium-Term Fiscal Framework.
