Philippines' budget deficit declines 24.75% in November 2023

29 Dec '23

3 min read

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Insights

The Philippines' budget deficit in November 2023 was P93.3 billion, down 24.75 per cent YoY.
This resulted from a 2.82 per cent rise in revenue and a 4.69 per cent drop in spending.
The country's YTD deficit stands at P1.111 trillion, 10.09 per cent lower than 2022, at 74.10 per cent of the FY23 target.
Government receipts rose to P340.4 billion.

The Philippines’ reported a budget deficit of P93.3 billion in November 2023, marking a 24.75 per cent decline from the previous year. This decrease, amounting to Philippine peso (P) 30.7 billion, is attributed to a 2.82 per cent growth in revenue collection coupled with a 4.69 per cent contraction in public spending, according to the Bureau of the Treasury.

The year-to-date (YTD) budget deficit now stands at P1.111 trillion, which is P124.6 billion or 10.09 per cent lower compared to the same period in 2022. Notably, this figure represents 74.10 per cent of the P1.499 trillion full-year 2023 (FY23) programme.

Government receipts for November saw an increase to P340.4 billion, 2.82 per cent higher than last year's P331.1 billion. This boost was driven primarily by a sharp increase in non-tax collection. Consequently, the cumulative collection for the 11-month period rose by 8.75 per cent or P286.7 billion year-on-year (YoY), reaching P3.564 trillion and accounting for 95.58 per cent of the P3.729 trillion full-year target. Tax-generated revenue constituted 89.28 per cent of the YTD collection (P3.182 trillion), with the remaining 10.72 per cent coming from non-tax sources, as per the bureau.

The Bureau of Internal Revenue (BIR) experienced a decrease in its November collection to P210.2 billion (net of P1.2 billion tax refund) from P237.1 billion raised in the same month last year, due to the shift in VAT remittance deadline. However, the BIR's YTD collection reached P2.343 trillion, surpassing the previous year's performance by 8.64 per cent or P186.3 billion and achieving 88.77 per cent of its P2.639 trillion FY23 programme.

In contrast, the Bureau of Customs (BOC) saw its collections slow to P73.7 billion in November 2023, a 2.69 per cent decrease YoY. Despite this, the BOC's YTD collection of P812.0 billion for 2023 was up by 2.88 per cent or P22.8 billion compared to Jan-Nov 2022, reaching 92.89 per cent of its P874.2 billion annual goal.

Primary expenditures (net of interest payments) for November were P385.1 billion, 10.21 per cent (P43.8 billion) lower than in 2022. The cumulative primary spending of P4.108 trillion as of the end of November marked a 1.32 per cent or P53.7 billion improvement from a year ago.

Total interest payments (IP) for November reached P48.5 billion, an 86.06 per cent (P22.5 billion) increase YoY. The cumulative IP of P567.7 billion also saw a 23.60 per cent (P108.4 billion) rise from last year's level. As a percentage of total revenue and expenditure, IP from January to November increased to 15.93 per cent and 12.14 per cent from 14.01 per cent and 10.18 per cent, respectively.

Net of interest payments, the national government’s primary deficit for November stood at P44.7 billion, a 54.31 per cent or P53.1 billion decrease YoY. The YTD primary deficit thus declined to P543.5 billion, 30.01 per cent (P233 billion) lower than the P776.5 billion primary deficit incurred in the previous year. This data indicates a fiscal consolidation trend, as the Philippines manages its budget more effectively amidst various economic challenges.

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