Diokno to BIR, BOC: Hasten upgrades to raise revenue
FINANCE Secretary Benjamin E. Diokno has ordered the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC) to speed up their modernization programs in a bid to raise more revenues for the government.
Diokno said on Thursday that the administration will focus on pursuing technological innovations to build new industries, enhance the delivery of public services, and create more jobs and investment opportunities, paving the way for the country’s long-term economic recovery from the impact of the pandemic.
“For instance, my marching order to the Bureau of Internal Revenue and the Bureau of Customs is to fast-track their respective modernization programs to increase our tax effort,” Diokno said in a recorded message at an event organized by Fintech Alliance.ph, a trade association representing the digital finance space in the Philippines.
“The government expects to collect more revenues on the back of a faster and more broad-based economic growth. Thus, efficient and effective tax administration will be critical in funding our socioeconomic priorities,” he added.
As economic activity is expected to continuously pick up over the medium-term, the government’s economic team projects revenues to increase from 15.2 percent of GDP in 2022 to 17.6 percent of GDP in 2028, and tax effort to improve from 14.5 percent of GDP in 2022 to 17.1 percent of GDP in 2028.
Last year, the government’s tax effort or taxes as a share in the country’s economic output, settled at 14.1 percent of GDP, still lower than 14.5 percent recorded in 2019, according to an earlier economic bulletin issued by the Department of Finance.
The government’s economic team also expects to collect higher revenues each year from P3.3 trillion this year to P6.589 trillion in 2028. Meanwhile, they also project the Philippine economy to grow 6.5 to 7.5 percent this year and 6.5 to 8 percent annually starting next year until 2028.
Under President Marcos, Jr.’s 8-point socioeconomic agenda, the government committed to expand the country’s digital infrastructure and promoting research and development as well as innovation over the medium term.
To broaden financial inclusion, Diokno said they will accelerate the rollout of the Philippine Identification System (Philsys) and widen the reach of the branchless and digital-only Overseas Filipino Bank (Ofbank).
On top of this, he also said they will “pursue a more inclusive and broad-based capital market through the power of fintech.”
Likewise, Diokno said the administration will invite more fintech investments into the country by taking advantage of the gamechanging reforms that were already in place, such as the Corporate Recovery and Tax Incentives for Enterprises Law and the amendments to the Retail Trade Liberalization Act, Public Service Act and Foreign Investments Act.
“We have a young, highlyskilled, and tech-savvy workforce. This is our strongest asset. The Marcos administration is strongly committed to increasing our investments in human capital development to equip tomorrow’s workforce to become globally competitive stewards of innovation,” Diokno said.