THE World Bank (WB) expressed interest to help the Department of Finance (DOF) in implementing the proposed comprehensive tax reform program.
Victoria Kwakwa, WB–East Asia and the Pacific Region vice president, said the move would lead to a more efficient tax collection and broader tax base in the country, a necessary element to fund socioeconomic development projects crucial in achieving inclusive growth.
In a meeting with Finance Secretary Carlos Dominguez III, WB executive said she offered to provide the new government with technical assistance and to share best practices and experiences in other countries to help the DOF effectively implement its proposed reforms on tax policy and administration.
“We are very happy about the tax reform and we discussed how we might support the implementation once it will be passed,” Kwakwa told reporters during her visit to Davao City last Friday. The World Bank’s offer of assistance came after Dominguez had explained to its officials the “transformative” reforms that the Duterte administration aims to carry out to help bring down the poverty rate from 26 percent in 2015 to 17 percent by the time the President steps aside in 2022.
These reforms include progressive tax reform packages to increase revenue collections while alleviating the tax burden on the middle class and vulnerable sectors, measures to ease business processes and cut red tape, initiatives to intensify social protection programs for the poorest of the poor, and accelerating spending on infrastructure by strengthening partnerships with the private sector.
“It was a very productive meeting with the World Bank officials,” Dominguez said. Following the Bank’s expression of support for the DOF’s proposed tax reform, Dominguez requested the Bank to discuss with BOC other possible areas of cooperation, including strengthening the Bureau’s capacity to improve its collection and reduce red tape.
Besides reducing poverty, Dominguez informed the World Bank delegation that the priority goals of the Duterte administration include upholding the rule of law and order and seeking lasting peace with armed rebels, as well as strengthening peaceful and cordial relations with the Philippines’ neighbors in the international community.
During the one-and-a-half hour meeting, Dominguez also conveyed the government’s strong interest in aligning the current Country Partnership Strategy (CPS) with the World Bank to President Duterte’s 10-point socioeconomic agenda and the forthcoming Philippine Development Plan, which focus on inclusive growth.
The World Bank’s Philippine portfolio comprises 15 operations with a total net commitment of around $3 billion. These include projects on irrigation, road improvements, rural development, transport, basic education and social protection.
Around $600 million worth of proposed projects funded with World Bank loans are likewise in the pipeline. Also, Kwakwa further shared that they also discussed a policy that promotes competition and competitiveness “which is really critical in spurring growth.” (ASP )