Gov’t seen keeping economic growth goals
Economic managers will likely keep the government’s growth targets when they meet to review macroeconomic and fiscal programs next month, Budget Secretary Benjamin E. Diokno said.
“I do not expect any adjustment in the macroeconomic parameters,” Diokno told the Inquirer last Friday, as he disclosed that the Cabinet-level, interagency Development Budget Coordination Committee (DBCC) would meet in mid-June.
The Duterte administration targets a 6.5 to 7.5-percent gross domestic product (GDP) growth this year, even as the first-quarter figure fell below expectations at 6.4 percent. Annual GDP growth target in the next five years was set at 7-8 percent.
As for the proposed P3.84-trillion national budget for 2018, Diokno said the Department of Budget and Management was finalizing tier two of the budget, referring to new programs and expansion projects.
In December, the DBCC said the record 2018 budget, up 14.6 percent from this year’s P3.35-trillion budget, would be contingent on Congress’ approval of the proposed first tax reform package, aimed at easing the burden on personal income earners while slapping new or additional taxes on consumption.
Diokno is optimistic that the first package of the comprehensive tax reform program would be passed in Congress before the end of the year.
But while Congress tackles the tax reform package that will raise more revenues to fund massive infrastructure projects, “we will be more careful in prioritizing government programs and projects,” he said.
“However, I do not expect that the DBCC will drastically change the medium-term fiscal program as a result of any delay in the passage of the tax reform program,” according to Diokno.
The latest Department of Finance computations showed that lowering the personal income tax rates coupled with the reduction in donor and estate taxes would result in foregone revenue of P140.1 billion when implemented in 2018.
The value-added tax base expansion as well as higher automobile and petroleum excise taxes would bring about revenue gain of P187.7 billion next year. Complementary measures would add P65.8 billion in revenue, on top of a P43.8-billion gain from tax administration measures.
