The government further improved the share of tax and other revenue collections to the economy, and even exceeded the revenue effort goal it set for the year.
“Over the past three years, we have seen total and tax revenues growing by a quicker pace than GDP [gross domestic product]. The first three quarters of 2014 were no exception to this trend—total revenues have grown 12.5 percent, while tax revenues have gone up 12.3 percent—both faster than the 9.1-percent nominal growth in GDP over the same period,” Finance Secretary Cesar V. Purisima said in a statement.
GDP is the total value of goods and services produced in a country.
In the nine months to September, the government’s tax and revenue efforts also improved, Department of Finance (DOF) data showed.
In terms of tax effort, 14.1 percent was recorded at end-September, higher than the 13.7 percent seen during the first nine months of 2013. The tax effort goal for this year is set at 14.7 percent.
From January and September 2014, revenue effort rose by 15.8 percent from last year’s 15.3 percent. Thus, the revenue effort target of 15.7 percent for 2014 has already been breached, Purisima pointed out.
“This notable improvement in collections has been the fruit of automation of tax processes, a heightened campaign against smugglers and tax evaders, and sustained reforms, especially in the Bureau of Customs [BOC],” the Finance chief said.
The BOC and the Bureau of Internal Revenue (BIR) are the two biggest tax and revenue collection agencies under the DOF.
Also, Purisima expressed confidence that with the Philippines joining the Organization for Economic Cooperation and Development’s Committee on Fiscal Affairs, coupled with the recent appointment of Revenue Commissioner Kim S. Jacinto-Henares as a United Nations international tax expert, “we are expecting a further boost in our revenue-generating capacity in the future” as “the Philippines [takes] on a more active role in the global fight against tax evasion.”
The latest tax and revenue effort figures, he said, “along with manageable national and general government debt levels, clearly manifest that the Philippines continues to stand on firm fiscal footing, which remains to be at the core of our country’s growth story.”
Latest government data released on Monday showed that revenues generated by the BOC, the BIR and the Bureau of the Treasury amounted to P152.3 billion last October—up 13 percent year-on-year. From January to October, collections totaled P1.6 trillion—13-percent higher than that of last year.