Finance Secretary Carlos Dominguez III has assured the public that the government will continue to maintain fiscal discipline as it goes ahead with its aggressive public spending to keep the momentum of the “Build, Build, Build” infrastructure program that is designed to fuel high—and inclusive—growth.
The Department of Finance (DOF) and the Bureau of the Treasury (BTr), according to Dominguez, will also ensure that the government’s borrowing policy remains
cost-efficient to provide it with enough resources to fund its infrastructure and other priority programs.
Dominguez said the country’s fiscal position “is strong” and “will continue to be so in the foreseeable future.”
To maintain the momentum of the “Build, Build, Build” program, Dominguez said the economic managers slightly adjusted the deficit forecast from 3 percent to 3.2 percent through 2019.
“We assure our people that the government remains steadfast in its commitment to fiscal discipline. The improved revenue collections are channeled to productive spending that will clear the way towards inclusive economic growth,” Dominguez said during the press briefing after the 173rd meeting of the Development Budget Coordination Committee (DBCC) at the Department of Budget and Management (DBM) office in Manila.
For the first five months of 2018, Dominguez said total revenues have already reached P1.19 trillion, which is higher by 19 percent year-on-year and also 7.4 percent above the target.
From January to May this year, the Bureau of Internal Revenue (BIR) collected P828 billion, or 15.5 percent higher than the same period last year and 3.1 percent higher than the target set for the agency.
During the same period, the Bureau of Customs’ (BOC) receipts amounted to P229.3 billion pesos, representing a 31.2 percent increase from the same period last year and 2.4 percent above target.
“For these, we credit the administrative reforms undertaken by both agencies as well as the beneficial effects of the TRAIN (Tax Reform for Acceleration and Inclusion) Law passed late last year,” he said.
Dominguez said that to ensure efficient borrowing, this year’s goal of sourcing 65 percent of loans from the domestic market and 35 percent from external sources will be modified so that the government will now be targeting the proportion of domestic borrowing to increase to 75 percent, which will reduce the percentage of external financing in the mix to 25 percent.
“The larger proportion of domestic borrowing in the 2019 mix will help us better hedge against foreign exchange risks,” Dominguez said.