The national government reported a fiscal surplus totaling P32.6 billion in August this year as consequence of robust year-on-year revenue growth and only a modestly paced expenditure activity, the Bureau of the Treasury (BTr) said. This brought the national government’s budgetary shortfall to P138.4 billion year-to-date.
According to the Department of Finance (DOF), national government revenue collection outstripped expenditures during the month owing to prudent spending and strong tax payments.
In a Treasury report submitted to Finance Secretary Carlos G. Dominguez III, the national government doubled its budgetary surplus in August to P32.6 billion, from only P15 billion in the same month last year.
“The surplus in August, the first under the Duterte administration, dragged down the eight-month fiscal gap to P138.4 billion, leaving the government ample fiscal room to support growth for the remainder of the year. The end-August budget deficit is also well within the P388.87-billion ceiling for the year, but significantly higher compared to the P3.4-billion gap incurred in the same period in 2015,” the BTr report said.
Government revenues in August increased by P32.9 billion, or 19 percent, totaling P209.6 billion compared to last year’s recorded P176.7 billion. Year-to-date revenue the national government generated totaled P1.480 trillion, 3 percent, or P39.9 billion, higher than that in the same period last year, when this totaled only P1.440 trillion.
“The slower growth pace was a result of the one-time transfer of coconut-levy assets worth P60.1 billion in May last year,” the DOF said. The coconut levy pertains to some P83 billion in cash and securities declared by the Supreme Court as public in character, and on this basis returned to coconut farmers to benefit the industry.
Netting out the nonrecurring coconut levy assets, Treasury data show government revenues improved by 7 percent year-on-year in the first eight months of 2016.
Of the amount, the Bureau of Internal Revenue (BIR) contributed P157.5 billion to the state coffers, increasing by 14 percent, or P18.9 billion, from the P138.5 billion recorded in the same month in 2015. Year-to-date, BIR revenues totaled P1.058 trillion this year, 10 percent higher compared to 2015 figures reaching only P962.6 billion.
The Bureau of Customs (BOC) generated revenues totaling P33.1 billion in August, 23 percent, or P6.2 billion, higher than year-ago revenues of only P26.9 billion. From January to August this year, the BOC collected P254.6 billion, higher by 8 percent from revenues in the same period in 2015, totaling P235.6 billion.
Both the BIR and the BOC accounted for a combined 90 percent of government revenues and raised their tax take during the month in double-digits, or by 14 percent and 23 percent, respectively.
Nontax revenues from other government agencies posted a jump of 75 percent to P12 billion in August this year, coming from the P6.9 billion recorded last year. Year-to-date, nontax revenues from other government agencies totaled P78.3 billion, a decline by P69.2 billion compared to P147.4 billion in the same period in 2015.
The BTr’s income doubled from last year’s P2.7 billion to P5.8 billion this year, up by P3.1 billion. Year-to-date, the bureau registered revenues totaling P78.6 billion, posting a contraction of 6 percent, or P5.3 billion, from P83.9 billion in 2015.
Total nontax revenues of the national government for August 2016 reached P17.8 billion, up by 87 percent, or P8.3 billion, from the P9.5 billion, recorded in the same month last year. From January to August this year, the national government posted non-tax revenues reaching P156.8 billion, lower by P74.5 billion, or 32 percent, from P231.3 billion in 2015.
Meanwhile, government spending accelerated by P15.3 billion, or 9 percent, making total expenditures for August 2016 reach P177 billion, higher compared to the registered P161 billion of the same month the previous year.
Interest payments took up 13.2 percent of total spending, which amounted to P23.4 billion in August. This was an increase of 42 percent from last year’s P16.5 billion. Year-to-date, government interest payments improved by 4 percent, or P8.5 billion, totaling P217.2 billion this year from last year’s P225.7 billion.
Netting out interest payments, the government also reverted to a primary surplus of P56 billion in August, following last month’s fall to a primary deficit. The figure was higher by 78 percent year-on-year, from primary surplus of P31.5 billion. This means interest payments were excluded from the computation. From January to August this year, national government total expenditures aggregated P1.619 trillion, up 12 percent compared to only P1.444 trillion a year earlier.
Netting out interest payments, the government ended the eight-month period with a P78.8-billion primary surplus, lower by P143.4 billion from the P222.2-billion primary surplus recorded in the same period the previous year.
The level of government spending is a closely watched driver of economic growth, as this contributes about a tenth of local output or the GDP.
In earlier reports, Dominguez vowed to reverse the penchant for spending below the program when former President Benigno S. Aquino III was the chief executive as part of the broad goal of optimizing the growth potential.
The government under President Duterte has committed to raise public investments in infrastructure, human capital and social protection as part of the 10-point socioeconomic agenda to sustain high growth and make its benefits trickle down to all Filipinos.