January budget surplus surges to PHP 165.4 billion

The National Government (NG) recorded a budget surplus of PHP 165.4 billion in January 2026, more than doubling the PHP 68.4 billion surplus posted in the same month last year, on the back of steady revenue growth and a sharp pullback in spending.

The January result, reported by the Bureau of the Treasury (BTr), represented a 141.91 percent or PHP 97 billion year-on-year improvement. It also marked a significant turnaround from the PHP 313.17 billion deficit recorded in December 2025 and was the first surplus since October 2025.

The NG collected PHP 468.9 billion in revenues for January 2026, slightly up by 0.36 percent or PHP 1.7 billion from the previous year’s actual collection of PHP 467.1 billion.

Taxes comprised the bulk of the month’s total collection, accounting for 94.45 percent or PHP 442.8 billion, which grew by 1.21 percent or PHP 5.3 billion from PHP 437.5 billion in January 2025.

Collections by the Bureau of Internal Revenue (BIR) increased to PHP 358.7 billion, 1.01 percent or PHP 3.6 billion higher than the previous year’s level of PHP 355.1 billion. The agency’s continued growth was supported by its digitalization initiatives and intensified tax administration efforts.

The Bureau of Customs (BOC) collected PHP 80.9 billion for the month, a 2.13 percent or PHP 1.7 billion expansion from last year’s intake. The positive result was driven by sustained enforcement operations, including the seizure of smuggled goods, the confiscation of illegally imported vehicles, and strengthened compliance and tax administration measures.

Collections from other offices held steady at PHP 3.2 billion, a marginal 0.63 percent increase from the same period last year.

Non-tax revenues, meanwhile, fell 12.08 percent or PHP 3.6 billion to PHP 26 billion from PHP 29.6 billion in January 2025, accounting for 5.55 percent of total collections.

The reduced intake was attributed to a moderation in BTr income, which dropped 13.17 percent to PHP 13.7 billion, and lower NG share from Malampaya gas field proceeds. Collections from other non-tax offices also declined 10.85 percent to PHP 12.4 billion.

On the spending side, NG expenditures fell sharply by 23.90 percent or PHP 95.3 billion to PHP 303.5 billion in January from PHP 398.8 billion in the same month last year.

The decline was primarily due to the rescheduling of transfers to Local Government Units (LGUs), as well as the base effect of large capital disbursements in January 2025, when the government settled accounts payable and frontloaded some expenditures ahead of the election ban.

Primary expenditures, net of interest payments, comprised 57.88 percent or PHP 175.7 billion of total January spending. This was 40.32 percent or PHP 118.7 billion less compared with PHP 294.4 billion in the previous year.

Interest payments, however, rose by 22.39 percent or PHP 23.4 billion to PHP 127.8 billion from PHP 104.4 billion last year. The increase was driven by additional debt incurred to finance the previous year’s deficit and changes in coupon payment timing following refinancing.

Excluding interest payments, the NG’s primary surplus for January surged to PHP 293.2 billion, up by 69.67 percent or PHP 120.4 billion from the PHP 172.8 billion primary surplus recorded in January 2025.

The strong January surplus comes after the Marcos administration closed 2025 with a PHP 1.58 trillion fiscal deficit, wider than the PHP 1.51 trillion gap in 2024 and exceeding the PHP 1.56 trillion target for the year. For 2026, the government has set a deficit ceiling of PHP 1.61 trillion, equivalent to 5.3 percent of gross domestic product.