Government returns to deficit in May

A greater P175 billion budget deficit for the Marcos administration was countered in May by more state spending on infrastructure projects. The fiscal turnout for May is 43% greater than the deficit for the prior year.

When there is a budget deficit, the government is spending more money than it is bringing in via tax collections—and doing so more quickly.

The budget deficit increased by 24% over the five-month period, from P326.3 billion to P404.8 billion, as spending increased more quickly than revenue during the review period.

From P455.7 billion in 2023 to P557 billion in May, government spending grew by 22%. Of this figure, 89% was spent on primary expenses. Increased national tax allotment shares, social and health programs, and capital expenditure projects were the driving forces behind this. In addition, interest payments rose from P41.3 billion to P61.1 billion (a 48% increase) in just one year. Tax collections accounted for 80% of the total revenue collection, which increased by 15% to P382.1 billion. While the Bureau of Customs (BOC) had a 4% increase to P81.3 billion, the Bureau of Internal Revenue (BIR) recorded a small improvement in revenue of 2.79% to P219.2 billion.

With collections from government businesses, guarantee fees, and the remittance of shares in the profit of the Philippine Amusement and Gaming Corp., Treasury income also increased by 181% to P70.2 billion.