The government’s budget deficit widened to P202.1 billion in May, a reversal of the P2.6-billion surplus a year ago, as government disbursements continued to gain traction against reduced revenue collections amid the coronavirus outbreak.
The Bureau of the Treasury said Tuesday the figure resulted in a year-to-date deficit of P562.2 billion, much higher than he previous year’s budget gap of just P809 million.
“May revenues decreased by 52.25 percent year-on-year, reaching just P151.5 billion as both tax and non-tax sources declined by 45 percent and 88 percent, respectively. Ninety-six percent or P145.2 billion of the monthly total were made up of taxes,” the Treasury said.
Collections in the first five months settled at P1.102 trillion, behind last year’s performance by 16.1 percent or P211.3 billion.
Collections of the Bureau of Internal Revenue collections contracted P90.4 billion or 44 percent in May to P114.4 billion from a year ago.
“The agency’s weak performance was still due to the effect of the prolonged enhanced community quarantine which prompted the bureau to further extend its deadline for tax filing and payments to June 14, 2020. From January to May, BIR collections were also reduced to P673.7 billion, 25.84 percent or P234.8 billion lower than the comparable outturn in 2019,” the Treasury said.
Collections by the Bureau of Customs also dipped to P30.8 billion in May from last year’s P58.2 billion on economic restrictions brought about by the COVID-19 pandemic. Customs collections in the five-month period also declined by 16.4 percent or P41.2 billion to P210.5 billion from a year earlier.
The Bureau of the Treasury said its income went down by 93.3 percent to P2.4 billion in May due to the timing of dividends which were remitted earlier this year because of the implementation of the Bayanihan to Heal as One Act.
It said it that in the first five months, it was still able to beat last year’s performance with total collections of P171.9 billion, more than twice what they were last year on account of higher dividends.
The agency also exceeded its full-year target of P82.3 billion by more than P89.7 billion.
Meanwhile, government expenditures in May increased 12.4 percent to P353.6 billion from a year ago. “The acceleration was propelled by the releases for the second tranche of the Small Business Wage Subsidy under the SSS in line with the implementation of RA 11469,” it said.
Government expenditures rose 26.6 percent in the first five months to P1.664 trillion from P1.314 trillion in the same period last year.
Primary spending (net of interest payment) stood at P335.3 billion in May and were up 13.65 percent from a year ago, resulting in a five-month expansion of 29.30 percent to P1.504 trillion. Total interest payments in May reached P18.4 billion, declining by 6.69 percent year-on-year to domestic debt that matured last year.
Total interest payment in the first five months reached P160.1 billion, up by 6.05 percent or P9.1 billion from last year’s level. Interest payments comprised 9.62 percent of the total expenditures as of end-May, declining from last year’s 11.49 percent.
Excluding interest payments from expenditures, the government recorded P183.8 billion in primary deficit in May, in contrast to the P22.2-billion primary surplus in the same month last year.
This increased the primary deficit in the five-month period to P402.1 billion, also a reversal of last year’s P150.2-billion primary surplus.