Department of Finance (DOF) Secretary Ralph Recto announced that tax revenues must grow by 10.2 percent annually from 2025 to 2028 to secure a stable funding stream for government operations. This growth would elevate total revenues to nearly PHP6 trillion by the end of President Ferdinand R. Marcos Jr.’s term and exceed PHP7 trillion by 2030.
To achieve this, Recto outlined strategies including enhancing administrative efficiency through modernization and digitalization at the Bureau of Internal Revenue (BIR) and Bureau of Customs (BOC), increasing non-tax revenues, and implementing the proposed General Tax Amnesty and Estate Tax Amnesty extension. Last year, the DOF and its agencies collected PHP4.42 trillion, which supported key initiatives such as education for 24.54 million public school students, medical assistance for 6.4 million patients, and PHP871.38 billion in local government funding.
For this year, the DOF aims to collect PHP13.65 billion daily to address a PHP4.51 billion daily deficit, supporting the government’s PHP18.61 billion daily expenditure. Recto warned that proposals to reduce the value-added tax (VAT) rate could result in significant revenue losses, potentially cutting public services and necessitating more borrowing. He noted that projected 2025 VAT collections of PHP1.39 trillion would only cover nine months of payroll, premiums, and pensions for government workers, while PHP576 billion in excise taxes falls short of the PHP965-billion education budget.
Recto emphasized that amid rising needs, reducing taxes like VAT could strain finances, as several bills in Congress advocate for such cuts to alleviate consumer burdens. This underscores the balance between fiscal responsibility and public relief.