Government cash buffer still healthy

MANILA, Philippines — The government still has a healthy cash buffer to fund programs despite the one-month extension of the deadline for income tax filing and payments, according to the Bureau of the Treasury (BTr).

In a text message to reporters, National Treasurer Rosalia de Leon said the government coffer is still awash with cash following the successful issuance of retail Treasury bonds (RTBs) last month and the regular weekly auctions of government securities.

She said this would be enough to fund programs despite the one-month delay in tax collections due to the extension of the deadline for the filing of income tax returns (ITR).

 “We can still afford. It is only one month. We have cash stashed from RTB and full award of auctions,” De Leon said.

Last February, the national government  successfully raised P310.8 billion from the issuance of three-year retail treasury bonds (RTBs), the highest volume recorded for any of its retail offering. The debt papers were sold at a coupon rate of 4.375 percent.

Meanwhile, De Leon said the Treasury’s regular auction for Treasury bills would proceed today, while the public offering for seven-year Treasury bonds would take place tomorrow.

She said the BTr is also in the process of consulting the market to determine the national government’s borrowing program in the second quarter. 

Earlier, the Bureau of Internal Revenue (BIR) announced that it will extend the deadline for the filing of ITRs and the corresponding payment of taxes from April 15 to May 15.

It also moved the deadline for other tax returns, giving taxpayers an additional month to file and settle their obligations.

The Department of Finance (DOF) said the deadline was moved to provide relief to taxpayers who cannot  prepare the necessary documents on or before the original deadline because of the enhanced community quarantine.  

The DOF said   P145 billion in income tax collections would be delayed due to the extension of the filing of the income tax returns. 

The government, thus, appealed to taxpayers to file and pay their taxes early if they are ready, through mechanisms made available by the BIR, including online filing and payment platforms.

According to DOF estimates, the Philippines’ fiscal deficit could reach 3.6 percent of the gross domestic product (GDP) this year, higher than the government’s cap of 3.2 percent of GDP, due to the impact of the COVID-19 outbreak.

Finance Secretary Carlos Dominguez said earlier the pandemic may cut government revenues by P91 billion this year. Despite this, he said the government does not plan to lower its spending program and delay the implementation of projects.