Budget gap in ’25 at ₧1.576T, slightly off goal
THIS image provided by US Central Command shows an F-35C Lightning II preparing for launch on the flight deck of the USS Abraham Lincoln (CVN 72) in support of Operation Epic Fury on Monday, March 2, 2026. US NAVY VIA AP
By Reine Juvierre S. Alberto
T WORLD » A8
AS MIDEAST CONFLICT WIDENS, US SAYS ATTACKS ON IRAN TO INTENSIFY FOR WEEKS
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HE national government closed 2025 with its budget deficit slightly exceeding its target at P1.576 trillion, as it missed its revenue collection goal but kept disbursements in check. Latest data from the Bureau of the Treasury (BTr) showed the government’s budget shortfall of P1.576 trillion was wider by 4.68 percent from the previous year’s P1.506 trillion. This comes after revenues amounted to P4.453 trillion, while expenditures reached P6.030 trillion. The deficit went beyond the government’s target of P1.561 trillion by just 0.97 percent, as the shortfall in revenue collections was partly
offset by spending restraint. Compared against the country’s gross domestic product (GDP), the deficit-to-GDP ratio stood at 5.63 percent—an improvement from the previous year’s 5.70 percent. “[The government] underperformed even if they kept within the budget,” Ateneo de Manila University economist Leonardo A. Lanzona told the BusinessMirror. Lanzona said the government was expected to deliver public goods intended to grow the economy and provide services to raise welfare. “But because of the need to reassess the institutions, they failed in doing their obligations.” Moreover, the issue with revenues is that it is not spent for its intended objectives. “In effect, people are paying taxes for nothing,” Lanzona added.
Revenues up but below target
ON one hand, the revenues collected posted a marginal increase of 0.78 percent to P4.453 trillion from P4.419 trillion in 2024. Of the amount, P4.077 trillion were tax revenues, which increased by 7.27 percent year-on-year, while non-tax revenues amounted to P376.3 billion, down by 39.15 percent due to the non-recurrence of extraordinary windfall receipts in the previous year. Revenues collected fell short of the revised target of P4.52 trillion by 1.48 percent, as the overperformance in non-tax revenues was “not enough” to offset the shortfall in tax collections, the Treasury said. Expectedly, revenue effort fell to 15.90 percent in 2025 from 16.72 percent a year ago. Tax
effort, meanwhile, grew to 14.55 percent from 14.38 percent in the year prior. The Bureau of Internal Revenue (BIR) raised P3.109 trillion, up by 9.06 percent from the P2.851 trillion collected in 2024. This growth was driven by stronger collections from corporate income tax, personal income tax, value-added tax, documentary stamp tax and excise tax on tobacco, the Treasury said. However, the BIR failed to meet its revised full-year target of P3.22 trillion by 3.41 percent due to the pause in payments for infrastructure-related government contracts amid investigations into flood control projects, as well as the temporary suspension of audit operations.
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See “Budget,” A8
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‘SPECIAL POWER’ TO FIX FUEL EXCISE TAX SOUGHT www.businessmirror.com.ph
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By Samuel P. Medenilla & Reine Juvierre S. Alberto
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S the government braces for the economic impact of the volatile Middle East situation, President Ferdinand Marcos Jr. announced he is considering asking Congress for “special powers” to temporarily adjust fuel excise taxes and implementing targeted fuel subsidies. Finance Secretary Frederick D. Go confirmed separately that the administration’s economic team is moving to work with Congress to
secure authority for the President to implement the measure, even if it means losing much-needed revenues. See “Tax,” A2
BSP RAISES TRIGGER LIMIT FOR CASH WITHDRAWALS TO P1M
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HE Bangko Sentral ng Pilipinas (BSP) raised the threshold for cash withdrawals that would trigger enhanced due diligence (EDD) to P1 million. In a statement on Tuesday, the central bank said this is “designed to focus on higher-risk activity while streamlining the process for legitimate and normal cash transactions, including
recurring ones.” Under BSP Circular No. 1230, issued on February 27, 2026, the threshold was raised to P1 million from P500,000. BSP said the increase follows consultations with banks and industries, which showed a large number of legitimate cash transactions above the original threshold. See “BSP,” A2
SUN FLARES AND BLOOD MOONS A golden sun flare lights the morning sky on March 3, 2026, along Marilaque Highway in Boso-boso, Antipolo City, Rizal, as global tensions continue to simmer across the Middle East. By nightfall, the spectacle shifts from blaze to shadow. A total lunar eclipse—commonly called a “blood moon”—rises over Las Piñas City, where the moon takes on a deep reddish-orange hue at totality as Earth moves directly between the sun and the lunar surface. The phenomenon is also visible across Eastern Asia, Australia, the Central Pacific and the Americas. From flare to eclipse, the day traces a rare celestial arc—an orderly rhythm in the skies above, even as unrest persists below. BERNARD TESTA (ANTIPOLO) & NONIE REYES (LAS PIÑAS)
Electronics’ resilience to ease volatile trade impact
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SEOUL MATES Republic of Korea President Lee Jae Myung and First Lady Kim Hea Kyung arrive at the Philippine Air Force hangar in Pasay City for a State Visit on March 3 and 4 at the invitation of President Ferdinand R. Marcos Jr. The leaders are set to discuss defense, maritime cooperation, economic and development partnerships, and strengthening peopleto-people ties. NONIE REYES
HE continued resilience of the Philippines’s electronics shipments alongside diversified market exposure could help cushion the impact of global trade volatility, according to Maybank. The Malaysian bank said this as it expects the Philippines’s outbound shipments to grow by 8.4 percent this year while imports are seen to jump by 5.1 percent. This, it expects, even as exports grew moderately by 7.9 percent year-on-year in January 2026, compared to the 23.9 percent growth of outbound shipments in December 2025. “Continued electronics strength and diversified market exposure should help cushion against global trade volatility. Hence, we maintain our expectation for exports to grow by 8.4 percent and imports by 5.1 percent in 2026,” said Maybank. As such, it expects the country’s trade gap narrowing slightly further to -US$48.9 billion. In the January to December 2025 period, trade deficit was at -$49.17 billion. Maybank said the “improved” external balance
and ongoing supply chain diversification provide a firmer footing for the year ahead, despite global growth and policy uncertainties. Latest data from the Philippine Statistics Authority (PSA) showed that electronic products continued to dominate the country’s pie of outbound shipments. PSA data noted that electronics shipments amounted to $4.01 billion in January 2026, cornering 56.5 percent of the $7.09-billion exports pie in the said period. In January 2026, exports of electronic products grew by 18.8 percent. In 2025, Philippine electronics exports reached $45.96 billion or 54.44 percent of the country’s $84.4- billion exports in the January to December 2025 period. The Semiconductor and Electronics Industries in the Philippines Foundation Inc. (Seipi) said the country may be on track to reach nearly $50 billion in electronics exports in 2026. (See: https://businessmirror.com.ph/2026/01/01/semicon-exportscould-near-50b-in-2026-seipi/)
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PESO EXCHANGE RATES n US 58.0930 n JAPAN 0.3692 n UK 77.9143 n HK 7.4279 n CHINA 8.4122 n SINGAPORE 45.6311 n AUSTRALIA 41.1937 n EU 67.9107 n KOREA 0.0400 n SAUDI ARABIA 15.4832 Source: BSP (March 3, 2026)