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Business

Ex-finance chief urges government to collect new taxes

- Iris Gonzales -

MANILA, Philippines - The Philippines may get a credit upgrade sooner if the government implements a combination of revenue enhancement measures, former Finance Secretary Margarito Teves said over the weekend.

He urged the Aquino administration to raise revenues by introducing new taxes, improving tax administration measures and privatizing state-owned assets.

The former Finance chief said this is the better route in raising revenues instead of just plugging tax leaks.

“I believe this will help generate more revenues for the government and improve the chances of attaining a higher sustainable and inclusive economic growth as well as achieving the remaining targets in our millennium development goals (MDGs),” Teves said.

Teves served as Finance chief during the term of then president Gloria Macapagal-Arroyo. During his term, the government implemented a higher VAT rate of 12 percent, raised from 10 percent previously.

Teves said that credit rating agencies are one in saying that the government needs to improve collection efficiency.

“We are also likely to get an upgrade to an investment grade from international rating agencies sooner than if we were just going to rely on improvement in tax administration and collection efficiency in raising our revenues,” Teves said.

The government incurred a budget deficit of P26.482 billion in July, narrower than the P32.694 billion recorded a year ago.

The July deficit brought the budget gap in the first seven months of the year to P43.713 billion, significantly smaller than the P229.423 billion recorded in the same period last year.

For July alone, revenue collections reached P106.963 billion while expenditures amounted to P133.445 billion.

In July, the Bureau of Internal Revenue (BIR) collected P73.789 billion or 15.63 percent higher than the P63.813 billion the agency collected in the same period last year.

The Bureau of Customs (BOC), meanwhile, generated P21.283 billion in July or 4.29 percent lower than the P22.238 billion collected last year. The rest of the revenues for the month came from the Bureau of the Treasury (BTr) with P6.260 billion and other offices with P5.631 billion.

For the seven-month period, revenue collections reached P788.603 billion.

Of the amount, the BIR collected P531.785 billion during the period. This was higher than last year’s tax-take of P467.282 billion.

On the other hand, the BOC collected P149.840 billion or 2.04 percent lower than the P152.960 billion generated in the same period last year.

Income of the Bureau of the Treasury was recorded at P57.033 billion while collections from other offices was recorded at P49.945 billion during the seven-month period.

Expenditures from January to July 2011 amounted to P832.316 billion, 10 percent lower than the comparable disbursements in 2010.

BILLION

BUREAU OF CUSTOMS

BUREAU OF INTERNAL REVENUE

BUREAU OF THE TREASURY

FINANCE SECRETARY MARGARITO TEVES

FOR JULY

GLORIA MACAPAGAL-ARROYO

IN JULY

INCOME OF THE BUREAU OF THE TREASURY

TEVES

YEAR

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