Government revenues are fine but spending cut is needed

The Bureau of the Treasury (BTr) released the cash operations report for full year 2024 the other week.

- BIENVENIDO S. OPLAS JR.

So annual data is now complete and comparable, here are some of the important results.

One, overall revenues reached P4.42 trillion in 2024, 15.6 percent higher than P3.82 trillion in 2023, good. GDP growth at nominal values in 2024 was 8.7 percent. Overall revenues in 2019 was P3.14 trillion, declined to P2.86 trillion in 2020 due to the horrible lockdown and closure of many tax-paying businesses and shops.

Two, tax revenues reached P3.80 trillion, 10.8 percent higher than P3.43 trillion in 2023. It was P2.83 trillion in 2019 or nearly P1 trillion increase in five years.

Three, domestic-based taxes kept rising especially income tax, VAT and sales tax, but excise tax kept declining from P317.7 billion in 2021 to P312.2 billion in 2022, P293.0 billion in 2023, data for 2024 not reported out yet.

Excise tax revenues from alcohol and sugar-sweetened beverages kept rising but taxes from tobacco kept declining. From P176.5 billion in 2021 to P160.3 billion in 2022, P134.9 billion in 2023, and flat level in 2024 at around P134 billion. Illicit and smuggled tobacco that pay zero excise tax and VAT and hence sold cheaply is the main culprit.

Four, non-tax revenues jumped big time, from P325.7 billion in 2022 to P394.8 billion in 2023 to P618.3 billion in 2024. These represent 21.2 percent growth in 2023 and 56.6 percent growth in 2024.

Five, remittances by government corporations contributed a big chunk of this big increase in non-tax revenues, from P91.6 billion in 2023 to P255.4 billion in 2024, a whooping 179 percent increase.