FINANCE Secretary Benjamin Diokno said that he will be turning over a solid DOF to incoming Secretary Ralph Recto.
Diokno said that since taking the helm at the DOF on July 1, 2022, he has committed to pursuing the Marcos, Jr. administration’s overarching goals of reducing the deficit-to-GDP ratio to 3.0 percent, achieving upper middle-income status by 2025, and bringing down poverty incidence to single-digit by the end of the President’s term.
In a statement, Diokno said he led the economic team in crafting the Philippines’ first-ever Medium-Term Fiscal Framework (MTFF) during the Marcos, Jr. administration’s first month in office.
The MTFF embodies the government’s commitment to pursuing fiscal consolidation, ensuring that sustainability is given priority in the management of finances without sacrificing economic growth.
Improving revenue generation and boosting government spending are at the core of the MTFF.
For the first 10 months of 2023, the National Government (NG)’s actual revenue collection rose to PHP 3.2 trillion, higher by 9.4 percent compared to the same period last year.
Revenue collections also exceeded the target for the period by 5.2 percent due to better collection performance by the Bureau of Customs (BOC) and income from the Bureau of the Treasury (BTr).
Digitalization, which Secretary Diokno strongly advocated for, played a significant role in the improved revenue collection performance.
For instance, the Bureau of Internal Revenue (BIR) bolstered its Digital Transformation (DX) Program which provided taxpayers with modern, convenient, and accessible tools to elevate taxpayer experience, thereby increasing taxpayer compliance as well as transparency.
Similarly, the BOC has so far digitized 161 out of 166 customs processes, resulting in a 97-percent digitalization rate. These efforts allowed the Bureau to enhance its trade facilitation.
The Development Budget Coordination Committee (DBCC) projects revenue collections to reach P3.8 trillion by the end of 2023 and further rise to P6.6 trillion in 2028 due to the anticipated implementation of priority tax measures over the medium term.
Likewise Diokno said that he had previously vowed to broaden the tax base to ensure fairness where everyone can contribute their fair share of taxes.
These are Package 3 of the Comprehensive Tax Reform Program (CTRP) or the Real Property Valuation and Assessment Reform (RPVAR), Package 4 of the CTRP or the Passive Income and Financial Intermediaries Taxation Act (PIFITA), excise taxes on pre-mixed alcohol, sweetened beverages and junk food, and single-use plastics (SUPs), as well as the rationalization of the mining fiscal regime and the Motor Vehicle Road User’s Tax (MVRUT).
He also proposed to improve Philippine tax laws to be at par with international standards.
“I am proud knowing that I will be leaving my post at a time when the Philippine economy, in general, and the DOF, in particular, are in a better state of affairs than when I inherited them,” Secretary Diokno said.
