GOVERNMENT REVENUE LOWER BY P560.5 BILLION
Government revenues this year is expected to be lower by P560.5 billion due to the Covid 19 pandemic with revenue collections seen to hit P2.61 trillion from its previous estimate of P3.17 trillion set last March 27.
The disbursement though was revised to and is now seen to hit PhP4.18 trillion, which is equivalent to 21.7 percent of GDP.
This slightly exceeds the program approved in March by PhP12.0 billion or 0.3 percent of GDP. The emerging disbursement program takes into account the releases for COVID-19 initiatives charged to savings coming from austerity measures, among others.
With the revised revenue and disbursement program, the deficit for FY 2020 is projected to reach PhP1.56 trillion or 8.1 percent of GDP.
This is 2.8 percentage points higher than the estimate of 5.3 percent of GDP announced last March.
The Development Budget Coordination Committee however, maintains that the debt level remains manageable, especially as the Philippines enjoyed its lowest-recorded debt-to-GDP ratio of 39.6 percent last year.
Despite increased deficit spending, the national government’s deficit-to-GDP ratio will remain in the median of comparable countries in ASEAN and in East Asia, among peers with similar credit ratings, and among other emerging market economies, as long as the ratio does not exceed 9.0 percent.