Tax effort picks up, Q1 spending effort down
The budget deficit got bigger with the government’s lackluster spending performance.
The Department of Finance celebrated the local economy’s strong first quarter performance, thanks to additional taxes from the Tax Reform for Acceleration and Inclusion law.
The country’s tax effort rose to 14.6 percent as against 14.3 percent the previous year.
Now comes the sad part: expenditure effort fell to 18.5 percent from 19.7 percent of GDP owing to the delayed passage of the 2019 budget.
The government was unable to spend P69.5 billion, which led to a fiscal deficit of 2.1 percent of GDP, versus the 3.1 percent target.
Will they make a strong comeback this quarter?