Finance Secretary Ralph Recto intends to keep the collection goals of the government’s revenue-generating agencies amid their strong collection performance so far this year and with plans to further improve tax administration.
Recto told reporters his plan to conduct meetings with both the Bureaus of Internal Revenue (BIR) and of Customs (BOC) to discuss their respective revenue targets over the medium-term.
Previously, the Department of Finance (DOF) mentioned the possible higher financing requirement of P2.57 trillion for this year, amid recent adjustments made in the government’s fiscal program, however this will also depend on the government’s revenue performance for 2024.
“We revised the Development Budget Coordination Committee targets and as a consequence of that, revenues will be less because of less growth, ergo there’s a possibility of an increased borrowing. But that all depends if (we’re) able to hit our revenue targets this year,” Recto said in a recent interview.
“We have not reduced the revenue target. (There’s) no need to revise it yet, so far we’re on target. So far they’re doing pretty good. If you follow that (current) growth rate there’s no need to borrow more,” he added.
The BIR collected P145.3 billion for March, growing by 3.11 percent from P141 billion in 2023.
This improved the agency’s overall collection for the first quarter of 2024 to P591.8 billion, 17.15 percent better than the previous year’s outturn.
Meanwhile, the BOC registered a 6.78 percent contraction year-on-year in its March collection of P74.9 billion partly due to fewer working days for the month compared to last year.
Nevertheless, BOC’s cumulative collection for the three-month period amounting to P218.9 billion still outperformed the previous year’s performance by 2.35 percent.
“If they can continue with that (strong collection performance), we should not be borrowing more, in fact we should be borrowing less, right?” Recto said.
The BIR has a collection goal of P3.06 trillion for this year, while the BOC is tasked to hit the P1 trillion mark.
Recto also said part of the strategy which will be discussed during his meeting with the revenue-generating agencies, particularly with BIR, is how to collect taxes based on transactions done through e-commerce.
“I’ve seen data that roughly one-fourth of all purchases today is done through e-commerce. So now we have to be able to collect those taxes,” Recto said.
“If government fails to adopt, we will not be able to collect those revenues. It’s important that we’re able to catch up with the private sector with how consumers behave and that we’re able to collect taxes and revenues through digital platforms,” he added.
