Finance Secretary Carlos G. Dominguez III (File photo from the Philippine Daily Inquirer)
The Duterte administration’s ambitious “Build, Build, Build” program might not be completed if Congress would not pass the proposed comprehensive tax reform program, Finance Secretary Carlos G. Dominguez III said.
Dominguez told senators during the briefing on Wednesday on the proposed P3.767-trillion national budget for 2018 that the government planned to spend over P1 trillion for infrastructure projects next year and a total of up to P9 trillion until 2022.
To finance the higher requirement for infrastructure spending, the government would source the bulk or 80 percent of the funds locally while tapping multilateral lenders as well as development partners such as China and Japan for the rest, Dominguez said.
He added that the Tax Reform for Acceleration and Inclusion (Train) would also generate additional funding for the infrastructure buildup.
Asked how important Train would be for the “Build, Build, Build” program, Dominguez replied: “It’s very important. Without the Train, we will probably not be able to fund half, maybe not even half [of the infrastructure projects].”
Dominguez said the additional funds from tax reform would be crucial so that the government would not breach the programmed 3-percent annual budget deficit cap.
Asked further what would happen if Congress would not pass Train, Dominguez said the “Build, Build, Build” initiative “will not continue as projected” as the projects may be reduced by “less than half.”
The government plans to roll out over P3.6 trillion in public infrastructure projects from 2018 until 2020, as the state planning agency National Economic and Development Authority jacked up to 75 from 55 previously the number of so-called flagship, “game-changing” projects that the administration aims to start and complete before 2022.
Under its “Build, Build, Build” program, the Duterte administation plans to usher in a “golden age of infrastructure.”
During the hearing, Dominguez sought support for the Department of Finance-backed Senate Bill No. 1408, which contains the first package of the tax reform program aimed at brining down personal income tax rates while slapping new or additional taxes on consumption.
Dominguez said the bill would generate net revenues of P169 billion if implemented in 2018. /atm