Finance Secretary Ralph Recto said Monday that the government’s two main revenue agencies—the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC)—are showing contrasting but telling signs of growth under their current leadership.
At a House budget hearing, Recto praised the BIR for delivering a strong 13% increase in collections this year, calling its performance “spectacular” amid tight fiscal conditions. The bureau’s growth, he stressed, is vital to government financing, especially with rising demands for infrastructure and social programs.
The Customs bureau, long hounded by inefficiency and smuggling controversies, has posted only modest growth. Still, Recto pointed to a turnaround since the appointment of Commissioner Ariel Nepomuceno on July 1.
“Under the new commissioner, there’s been improvement. He is doing what needs to be done against smuggling and in trade facilitation,” Recto said, adding that stronger leadership is beginning to reflect in Customs’ operations.
Nepomuceno, who previously served in disaster response and civil defense, now faces the challenge of cleaning up one of the country’s most politically sensitive and corruption-prone agencies. Lawmakers, including Manila Rep. Rolando Valeriano, pressed the DOF on how the bureau plans to stop smuggling that costs billions in lost revenues yearly.
Recto assured the House panel that reforms are underway, but admitted the task is far from over.
“The fight against smuggling is continuous. What matters now is that leadership is aligned with that mission,” he said.
Analysts note that while BIR’s steady growth provides the government with a cushion, Customs’ success—or failure—in cracking down on illicit trade could ultimately define the credibility of revenue reforms under Recto’s watch.