Wegotmail: Keynote speech of DOF Sec. Ralph Recto at EJAP-SMC Economic Forum 2024 (Part 3)

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Since fiscal goals are anchored to growth targets, setting high GDP targets amidst external headwinds risks revenue shortfalls. This would strain our deficit and potentially increase borrowing.

But tempering these targets does not diminish our commitment to fiscal consolidation. Instead, it reflects a confident and conservative approach to fiscal policy-making.

Over the medium term, we anticipate a 10.3 percent average annual growth in total revenues to support our people’s growing needs, reaching 4.27 trillion pesos in 2024 to 6.25 trillion pesos by 2028.

Tax collections are projected to increase by an average of 11.8 percent annually. This is faster than the 8.8 percent projected growth of our nominal GDP. 

In fact, for 2025, we expect double-digit collection growth from the BIR and BOC as we enhance their administrative efficiency through digitalization and plug leakages in the tax system, especially from e-commerce.

While no new tax proposals are on the table, refined revenue reforms await congressional approval. These reforms promise fairness and efficiency, ensuring that they do not translate to unnecessary burdens to Filipino consumers and taxpayers.

Upon passage, these reforms could additionally inject an average of 42 billion pesos annually into our coffers beginning in 2025.

We are also strategically maximizing our non-tax revenues to increase collections and ensure sustainable funding for priority programs and projects.

This includes dividends from GOCCs, which we target to collect 100 billion pesos in remittances by the end of this year.

We are also targeting to raise another 42 billion pesos from the privatization of government assets, such as its shares in private companies and public offices in prime locations.

Along with preventing wasteful expenditures, these strategies will help keep the deficit in check and reduce sustainably to only 3.7 percent in 2028.

At the same time, the economy will continue to outgrow the country’s debt with the debt-to-GDP ratio dropping to 56 percent in 2028. This will ensure that we have the ability to pay for our obligations. 

Another key aspect of our growth strategies is investing in high-impact sectors through stronger collaboration with the private sector. To be continued

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