By Aubrey Rose A. Inosante, Reporter
THE NATIONAL GOVERNMENT’S (NG) fiscal position swung to a surplus in October as revenues and expenditures declined amid a corruption scandal, the Bureau of the Treasury (BTr) said on Wednesday.
Data from the Treasury showed a P11.2-billion surplus in October, a turnaround from the P248.08-billion deficit in September and wider than the P6.3-billion surplus seen in October 2024.
This was the primary budget surplus because the P67.3-billion surplus in April.
In October, government expenditures fell by 7.76% to P430.6 billion from P466.8 billion in the identical month last yr.
October marked the third straight month that expenditures declined on an annual basis, as disbursements for public works projects were tightened amid a widening corruption probe.
Primary spending — which refers to total expenditures minus interest payments — fell by 9.29% to P373.2 billion in October from P411.4 billion a yr earlier.
Interest payments rose by 3.57% to P57.4 billion in October this yr from P55.4 billion in the identical month in 2024.
At the identical time, revenue declined by 6.64% to P441.7 billion in October from P473.1 billion in the identical month last yr.
Tax revenues inched down by 0.09% to P414.5 billion in October from P414.9 billion in the identical month in 2024.
The majority or 69.62% of tax revenues got here from the Bureau of Internal Revenue (BIR), whose collections rose by 1.02% to P328.8 billion in October from P325.5 billion a yr ago.
This included a P211-billion tax refund, which pushed the gross BIR collections to P329.1 billion.
“This robust performance was driven by collections from corporate income tax, personal income tax, value-added tax, percentage tax on banks/financial institutions, and excise tax on tobacco products,” the BTr said.
The Bureau of Customs (BoC) saw revenues fall by 4.52% to P83 billion in October from P86.9 billion a yr ago, as a ban on rice imports began in September.
Nontax revenues plunged by 53.29% to P27.2 billion in October from P58.3 billion in the identical month in 2024.
BTr revenues dropped by 13.82% to P12.5 billion in October, while other offices slid by 66.39% to P14.7 billion.
Reinielle Matt M. Erece, an economist at Oikonomia Advisory and Research, Inc., said in a Viber message that the broader surplus in October is especially brought on by the sharp decline in government spending.
“Since public spending issues became a hot topic, the federal government became very cautious to avoid backlash, thus spending went down significantly,” he said.
Nevertheless, he noted that revenues also declined attributable to slower economic activity and fewer tax filings.
Rizal Business Banking Corp. Chief Economist Michael L. Ricafort attributed the budget surplus to the federal government’s lower disbursement in implementation of anti-corruption measures.
The broader surplus could also signal more disciplined spending, Mr. Ricafort said in a Viber message.
Mr. Erece also noted that a surplus just isn’t necessarily a positive sign and will signal poor budget efficiency.
“Surpluses mean that there are still money or resources that could be used to further drive growth,” he said.
10-MONTH DEFICIT
For the primary 10 months, the NG budget deficit sharply widened to P1.11 trillion from the P963.9-billion gap in the identical period last yr.
“The ten-month fiscal gap was underpinned by a 1.13% growth in revenues, amidst the non-recurrence of last yr’s extraordinary nontax receipts, matched with a modest 3.9% expansion in expenditures,” the BTr said.
The Treasury said the end-October fiscal gap showed the “government’s continued implementation of priority programs and projects to speed up inclusive economic growth and drive meaningful social transformation.”
“The year-to-date deficit stays according to the federal government’s fiscal consolidation goal at 70.83% of the FY 2025 revised full-year goal of P1.56 trillion,” BTr said.
State spending rose by 3.9% to P4.91 trillion within the January-to-October period. This was already 80.8% of the P6.08-trillion revised full-year expenditure program.
Primary expenditures rose by 2.45% to P4.19 trillion as of end-October, while interest payments went up by 13.24% to P723.2 billion.
“The minimal growth in primary expenditures was affected by the contraction in infrastructure spending amid the continuing probe on the DPWH’s flood control issues and review of project implementation,” it said.
Meanwhile, total revenue collection throughout the January-to-October period slipped by 1.13% to P3.81 trillion. The BTr said the cumulative collection was 84.25% of the P4.52-trillion revised full-year program.
Tax revenues rose by 7.45% to P3.47 trillion, which was already 82.28% of the P4.21-trillion goal.
BIR collections went up by 7.45% to P3.47 trillion, accounting for 82.35% of the agency’s P3.22-trillion full-year goal.
Customs collection inched up by 0.91% to P784.6 billion as of end-October. This was 81.84% of the revised P958.7-billion program for the yr.
Nontax revenues plunged by 36.71% to P341.3 billion for the primary ten months of the yr, at the same time as it has already exceeded the P301.5-billion full-yr nontax revenue program by 11.37%.
Treasury income slipped by 6.75% to P209.6 billion as of end-October, while other offices’ income slumped by 58.12% to P131.7 billion.
In the approaching months, Mr. Ricafort said there continues to be a “good probability” that the NG could hit the P1.56-trillion budget deficit ceiling by yearend.
“(This) could possibly be made possible by further fiscal reform measures, tax reform measures, especially anti-corruption measures/reforms to extend the structural source of National Government revenues and to forestall corruption, wastage, leakages on the federal government expenditure side, as a part of the general priority on governance reforms,” he said.