MANILA – The Philippine government posted a P154.5-billion budget gap in the first half of 2017, higher than the P143.8-billion target for the period.
Data released by the Bureau of the Treasury (BTr) Monday showed a 28 percent rise in the budget deficit from year-ago’s PHP120.3 billion.
This, after expenditures rose by 9 percent to P1.33 trillion, hitting the target, from year-ago’s P1.22 trillion.
Revenues during the same period posted a lower growth of 7 percent to P1.176 trillion against the P1.101 trillion in end-June 2016. Compared to the program, collections in the first half of the year is one percent short of the P1.192 trillion goal.
Of the total revenues, the Bureau of Internal Revenue (BIR) collected P848 billion, 8 percent higher than year-ago’s P783.4 billion but 4 percent short of the agency’s P881.7- billion target.
The Bureau of Customs (BOC) collected P210.3 billion, 3 percent down from its P217.7-billion target but 10 percent higher than year-ago’s P190.6 billion.
Tax collection from Other Offices reached P10.8 billion as of end-June this year, up 20 percent from year-ago’s P9-billion revenues and 28 percent higher than the P8.4-billion goal.
Non-tax revenues for the period reached P107.3 billion, down 9 percent from year-ago’s P118 billion but 26 percent higher than the P85.2 billion target for the period.
”This is more as a result of the P16.6 billion undercollection in tax revenues,” Budget and Management Secretary Benjamin Diokno said in a message to reporters.
The Budget chief, however, pointed out that “the higher-than-program deficit should not be a concern.” He added, Annual deficit target is P482.1 billion. Expenditure is on the dot.”
Last June alone, revenues fell 7 percent short of the P194.2 billion target after it only reached P179.8 billion.
However, collections last June rose by 2 percent against year-ago’s P175.6 billion.
Expenditures surged by 23 percent to P270.7 billion from year-ago’s P220.8 billion. It was also 28 percent higher than the P210.9 billion target for the month.
“Underspending, the plague of the previous administration, appears to be a thing of the past,” Diokno added.
Finance Secretary Carlos Dominguez III expects better contribution from the BIR, which is tasked to collect around 70 percent of taxes, and the BOC in the next quarter. ”BIR and BOC will certainly make up the deficit in H1 tax collection by Q3,” he said.
The Finance chief also noted that the government is “expecting P30 billion from Mighty, which will wipe out the P16.6 billion under collection.”
He earlier disclosed the offer of cigarette manufacturer Mighty Corporation to settle its tax liabilities amounting to P25 billion. He said the amount would reach about P30 billion once the value added tax (VAT) and other fees are included in the computation.
Dominguez also cited the need for the approval of the proposed tax reform program to boost government revenues.
“This also proves that we need the tax reform so we can collect more taxes,” he added.