THE PHILIPPINE government’s major revenue-generating agencies are confident of meeting their revised full-year targets, after posting higher collections in the primary half of the 12 months.
Bureau of Internal Revenue (BIR) Commissioner Charlito Martin R. Mendoza said faster economic growth within the second half of the 12 months will boost tax collection.
“Hopefully, our infrastructure spending will improve, and our economic activities will speed up in the approaching months,” Mr. Mendoza told reporters last week.
“We hope for the next gross domestic product growth in the approaching months since it really has an impact on value-added tax, percentage tax and other business taxes,” he added.
The Philippine economy expanded by a slower-than-expected 2.8% in the primary quarter, the weakest growth because the pandemic and well below the 5.37% expansion in the identical quarter a 12 months earlier.
The Department of Economy, Planning, and Development earlier said the lingering effects of last 12 months’s corruption scandal and the escalation of the Middle East conflict could have weighed on growth within the second quarter. Nonetheless, it expects a recovery within the second semester amid a pickup in public spending.
Tentative data from the BIR showed that it collected P1.65 trillion in the primary six months, up 5.33% from P1.567 trillion a 12 months earlier.
“Nevertheless it remains to be very tentative… We’re still reconciling; it isn’t final yet. But definitely higher (than last 12 months). Although our growth rate for June isn’t as high as that of May, which was 15%,” Mr. Mendoza said.
“But you’ve got to grasp that in June last 12 months we had the deadline for the estate tax amnesty. So, the revenues from the estate tax amnesty got here in,” he added.
The BIR’s first-half collections accounted for 48.6% of the Development Budget Coordination Committee’s (DBCC) downwardly revised P3.393-trillion collection goal for 2026.
Mr. Mendoza admitted the revised collection goal stays a “tall order.”
“The goal is around P3.4 trillion. We collected P3.1 trillion last 12 months. That remains to be near a ten% growth, so it remains to be a tall order, but we’re doing our greatest to satisfy our goal,” he said. “To this point, we’re still on course especially with the P38-billion reduction in our goal.”
Mr. Mendoza said the agency hopes to book strong collections from nonresident digital service providers and excise taxes, amongst others.
HIGHER BOC TARGET
Meanwhile, Bureau of Customs (BoC) Commissioner Ariel F. Nepomuceno said the DBCC may have considered recent foreign exchange (forex) movements and other macroeconomic aspects when it hiked the agency’s collection goal by P7.2 billion.
The DBCC raised the BoC’s 2026 revenue goal by 0.7% to P1.011 trillion from P1.003 trillion previously. This because it adjusted the peso-dollar exchange rate assumption to P60-P62 this 12 months from P58-P60 previously.
The peso traded above P61 per dollar in July. It closed at P61.587 against the dollar on Friday, strengthening by 3.3 centavos from its P61.62 finish on Thursday.
“Primarily, it’s the changes in peso-dollar exchange rate and other macroeconomic aspects, plus they foresee the expansion of the economy,” Mr. Nepomuceno told reporters last week.
“But we will still achieve it, but our surplus of P11.8 billion will just be used to cover for that additional P7 billion,” he added, referring to the quantity by which first-half collections exceeded the agency’s goal.
In the primary half, BoC collections rose by 7.2% to P491.75 billion from P458.77 billion a 12 months earlier. Collections also exceeded the P480.27-billion goal for the period by 2.4%.
“There remains to be more room for improvement, comparable to the speed of assessment or the overall collection over the overall value of imports,” Mr. Nepomuceno said.
The Customs chief said his review of average assessment rates over time showed that the ratios at some ports were low and may very well be improved without departing from the transaction value regime.
“There are specific imported items that I do know if we increase the speed of assessment, we’ll lift the collections. But you’ve got to do this incrementally,” he said.
“Remember, we’re in a transaction value regime, meaning we now have to honor what they claim, based on their documents, are the actual prices they paid for his or her imports. We have now reference values, but we’ll respect their documents,” he added. — Justine Irish D. Tabile