The government's revenue shortfall for Feb. 2006 was marginally below the ceiling. The Department of Finance said that government revenue stood at PHP64.3 billion in February 2006, while it spent PHP89.2 billion, resulting in a budget deficit of PHP25 billion. Although this was 6% higher than the PHP23.6 billion recorded in February 2005, the deficit of PHP2.2 billion is below the PHP27.2 billion ceiling set for the period. The February deficit brought the government's fiscal shortfall in the first two months of the year to PHP40.4 billion, which is lower than the PHP48.1 billion ceiling for the period.

The government's fiscal performance in February takes into account the expected gains from the 20% increase in the value-added tax, which took effect in that month. DOF data shows that February 2006 revenue was PHP6.3 billion higher than the government's target, and an increase of 32% y/y. The Bureau of Internal Revenue generated revenue of PHP41.7 billion, while the Bureau of Customs also exceeded its PHP12.3 billion target for February 2006. Expenditures during Jan.-Feb. 2006 were PHP1.4 billion more than the PHP176 billion programmed. Presidential Spokesman Ignacio Bunye echoed DOF's optimism of achieving a balanced budget by end of 2008, two years ahead of a 2010 schedule.