PHL achieves budget surplus in April 2022

The National Government’s (NG) fiscal balance reverted to a P4.9 billion budget surplus in April 2022 due to faster year-over-year (YoY) revenue collection growth of 19.19% against the marginal 1.98% increase in public expenditures.

Meanwhile, the resulting cumulative budget balance as of end April remained at a deficit of P311.9 billion, albeit lower by 14.76% or P54.0 billion than the budget deficit recorded for the same period last year.

REVENUE PERFORMANCE

Government receipts reached P348.0 billion for the month of April, expanding by 19.19% or P56.0 billion over collections posted in the equivalent period a year ago as all government collecting agencies exhibited positive outturns. This allowed YTD revenue from January to April to grow at 14.56% or P143.9 billion to reach P1,132.3 billion. Tax collections comprised 89% or P1,004.1 billion of the total with the remaining 11% coming from non-tax sources.

Gross collections by the Bureau of Internal Revenue (BIR) amounted to P240.0 billion for the month of April, from which P413.0 million in tax refunds leaves a final net collection of P239.6 billion for a 9.39% improvement from last year’s outturn. YTD collection likewise rose to P742.4 billion, recording a 7.79% or P53.7 billion increase over the similar collection in 2021.

The Bureau of Customs (BOC) managed to maintain its growth momentum for the fourth consecutive month with P65.7 billion in April, which increased by 26.82% or P13.9 billion YoY. The higher collection was attributed to the improved valuation, intensified enforcement against illegal importations, and the improved compliance by traders to customs laws[i]. This pushed the agency’s aggregate revenue to P254.2 billion, outperforming the achievement for the same period a year ago by 26.50% or P53.3 billion.

The P25.7 billion income generated and collected by the Bureau of the Treasury (BTr) for the month was more than double last year’s level of P9.0 billion. The substantial increase was largely driven by higher dividend remittances as well as income from BSF investment and NG’s share from PAGCOR income. BTr’s cumulative revenue of P74.4 billion for the four-month period likewise represented a double-digit growth of 53.85% or P26.1 billion more than the P48.4 billion raised a year ago.

Collections from other offices (other non-tax including privatization proceeds and fees and charges) for the month reached P15.4 billion, surpassing last year’s outturn of P11.2 billion by 37.53% or P4.2 billion mainly due to BCDA’s higher remittance of disposition proceeds amounting to P6.4 billion compared to last year’s collection of P2.7 billion. Total collections as of end-April amounting to P53.8 billion was also 20.68% or P9.2 billion above the level recorded for the equivalent period of the preceding year.

EXPENDITURES 

Total NG disbursement was at P343.0 billion for the month, slightly growing by 1.98% or P6.7 billion on a YoY basis. The resulting YTD total expenditures as of end-April rose to P1,444.2 billion, a 6.64% or P89.9 billion expansion from the previous year’s P1,354.3 billion.

Primary expenditures (net of interest payments) for the month of April accounted for 89% or P305.7 billion of total expenditures, reflecting a 2.18% decline over last year sans the P22.9 billion one-time financial assistance (FA) provided to LGUs placed under ECQ (NCR Plus) last year, and timing of subsidy releases to GOCCs. Netting out the one-off releases, primary expenditure grew by 9.44% YoY. Nevertheless, cumulative primary expenditures of P1,257.6 billion for the Jan-Apr period still improved by P53.0 billion or 4.40% compared to 2021.

April Interest payments (IP) amounting to P37.3 billion was 56.61% or P13.5 billion higher relative to the P23.8 billion paid a year ago. Similarly, total IP of P186.6 billion as of end-April grew by 24.69% over last year’s four-month total of P149.7 billion.

PRIMARY SURPLUS/ (DEFICIT)  

For the month, the government posted a primary surplus of P42.2 billion, a turnaround from the P20.6 billion primary deficit incurred in the same period a year ago. Meanwhile, the primary balance as of end-April remained at a deficit of P125.3 billion, but down by 42.06% or P90.9 billion over last year’s primary deficit of P216.2 billion. 

FISCAL INDICATORS 

The Q1 deficit stands at 6.43% of GDP, declining from the 7.35% recorded for the equivalent period last year. Revenue effort as of end-March slightly decreased to 15.91% from 2021’s 15.93%. Similarly, tax effort dipped to 14.14% from the previous year’s 14.27%. Expenditure effort narrowed to 22.34% against 23.28% posted in the first quarter of 2021.

[i] https://customs.gov.ph/boc–collects–p65–7b–surpasses–april–target–by–p10b/