THE government is still looking at keeping its revenue goals for the year, Finance Secretary Ralph G. Recto said on Tuesday, after the Development Budget Coordination Committee (DBCC) cut the targets for the Tax and Customs bureaus.
“Those are DBCC numbers,” he told BusinessWorld in a Viber message. “We haven’t adjusted revenue targets for the year yet.”
In the DBCC’s latest quarterly fiscal program, the Bureau of Internal Revenue’s full-year revenue estimate was slashed to P2.85 trillion from P3.055 trillion, while its estimate for the Bureau of Customs was trimmed to P939.7 billion from P959 billion.
Mr. Recto said the revisions in the DBCC program were a “consequence of adjusting growth numbers.” “As I mentioned, [this is for the] DBCC. But [we] have not adjusted the Budget of Expenditures and Sources of Financing target.”
The cuts in the collection goals “reflect the current economic climate,” Robert Dan J. Roces, chief economist at Security Bank Corp., said in a Viber message, citing weaker-than-expected growth and global uncertainties.
The economy grew by 5.7% in the first quarter. At its April meeting, the DBCC narrowed this year’s growth target to 6-7% from 6.5-7.5%.
“It is hardly surprising that revenues are lower than expected,” Leonardo A. Lanzona, an economics professor at the Ateneo de Manila University, said in an e-mailed reply to questions. “Even if efforts are made to raise these funds more efficiently, the revenue receipts will not be able to meet the required amount needed for government purposes.”
Mr. Recto earlier said the government would not seek to impose new taxes and would instead boost tax administration and collection efficiency.
The Finance department is also working on privatizing government assets to boost state coffers.
“While this may necessitate adjustments to government spending and could lead to a wider fiscal deficit, the government’s focus on nontax revenue measures like privatization is a welcome alternative to introducing new taxes,” Mr. Roces said.
Mr. Lanzona said the no-tax policy would make it difficult for the government to support priority programs.
“This ties the hands of the government to meet the needs of the public,” he said. “Additional taxes should not be seen simply as the means of raising revenues, but as a mechanism to enforce a socially efficient economy.”
“It should allow the government to respond to unexpected events that can disrupt and reduce social welfare.”
The National Government’s revenues jumped by 16.8% to P1.47 trillion at the end of April. Tax revenue went up by 13.21% to P1.28 trillion, while nontax revenue climbed by 48.8% to P188.8 billion.
Meanwhile, the Customs bureau in a separate statement said it collected P81.75 billion in May, exceeding its target by 2.68%. It was also 4.9% higher than a year earlier.
From January to May, it collected P381.35 billion, surpassing its target by 4.18% and up by 6.13% from a year earlier.
The agency attributed this to “continuous monitoring of the values and classifications of imported commodities to ensure accurate duty and tax collection.”
It also cited audits and public auctions, intensified border control and improved trade facilitation. — Luisa Maria Jacinta C. Jocson
