Government’s Fiscal Deficit Decreases in March Due to Increase in Revenues
The Marcos administration in the Philippines saw a reduction in its budget deficit for the month of March, thanks to strong revenue growth that outpaced spending. According to the Bureau of the Treasury (BTr), the fiscal gap in March stood at P195.9 billion, which was 6.82 percent smaller compared to the deficit from the previous year.
In the first quarter of the year, the budget deficit reached P272.6 billion, showing a slight increase of 0.65 percent. The government’s revenue collection in March amounted to P287.9 billion, marking an 11.32 percent growth. This brought the total revenues for the first three months to P933.7 billion, a 14.05 percent increase from the previous year.
Despite a 6.78 percent decrease in revenues from the Bureau of Customs (BOC) in March, the overall three-month collections still showed growth. The BOC collected P74.9 billion in March but saw a cumulative increase of 2.35 percent to P218.9 billion for the first quarter.
The Bureau of Internal Revenue (BIR), which contributes significantly to the state’s revenues, reported a tax collection of P145.3 billion in March, up by 3.11 percent. In the first quarter, BIR collections rose by 17.15 percent to P591.8 billion.
Economists like Ruben Carlo Asuncion from Union Bank of the Philippines believe that the rise in revenue collection is a positive sign for the government’s fiscal consolidation plan. The administration aims to borrow P2.46 trillion in 2024 to bridge its budget deficit, with a revised deficit limit of P1.5 trillion.
However, there are concerns about the impact of a high-interest rate environment on government spending and economic growth. Asuncion emphasized the need for a balance between debt management, fiscal consolidation, and growth-focused spending to ensure economic stability and development.
