The government’s revenue and tax efforts in the first semester saw a reduction from the previous year’s levels.
But Finance Secretary Benjamin Diokno remains optimistic t the full-year targets for these will be met.
During the Development Budget Coordination Committee briefing to the Senate on the proposed 2024 National Budget yesterday, Diokno said the revenue effort for January to June saw a 0.54 percentage point drop to 16.2 percent from the 16.7 percent revenue-to-GDP ratio in the same period a year ago.
The tax effort likewise declined to 14.4 percent from the 14.9 percent recorded in the first semester of 2022.
“Let me explain the lower revenue ratios. These are due to two factors. First, the cash flow impact of the shift in value added tax payments from monthly to quarterly. And second, the second tranche reduction in personal income tax rates in the amount of P74 billion,” Diokno said.
“However, our revenue-to-GDP ratio for the first semester of 2023 of 16.2 percent is above the full year 2023 target of 15.2 percent. Meanwhile, the tax-to-GDP ratio for the first semester of the year of 14.4 percent is on track of meeting the full year target of 14.4 percent,” he added.
The Bureau of Internal Revenue’s (BIR) effort also declined to 10.6 percent for the first semester from 11 percent in the same time last year.Meanwhile, the Bureau of Customs’ (BOC) maintained its revenue effort of 3.8 percent.
The BIR and BOC have full year goals of 10.8 percent and 3.6 percent, respectively.
