A drop in GST, which was $261 million lower than forecast for February, is contributing to the Government's finances slipping back into a deficit of $269 million in the eight months to February.
The result makes the Government's pre-election aim of having its books back in surplus at this month's budget less likely.
Finance Minister Bill English describes the result, compared to last month, as "making the previous month's flirtation with surplus short-lived but nevertheless encouraging."
Figures for the seven months to January showed a surplus of $77 million - the first time since 2009 that the Government's books had shown a part-year surplus.
Labour's Finance spokesman, Grant Robertson, says February's deficit will damage people's trust in National.
"John Key has spent seven years and two election campaigns telling New Zealanders to trust him, be patient and that he will deliver a surplus this year. But eight months into the financial year the books are over $260 million still in the red. That's not good enough," Mr Robertson says.
Green Party associate finance spokeswoman, Julie Anne Genter, says, "Bill English is now on track to equal the humiliating record for the most number of consecutive Budget deficits under the same administration - seven - set by the National Government from 1966 to 1972."
Conceding that a Budget surplus is looking increasingly unlikely this year, Mr English says: "We're (the Government) is continuing to manage the books carefully but lower inflation, while good for consumers, is making it less likely that the final accounts in October will show a surplus for the whole year."