The Committee on Appropriations of the House of Representatives has endorsed for congressional approval the P17.29-billion budget of the Department of Finance (DOF) and its attached agencies for 2020, a proposed outlay that decreased for the third straight fiscal year since 2018.
Finance Secretary Carlos Dominguez III said the DOF’s 2020 budget plan is P1.59 billion or 8 percent lower than its 2019 budget of P18.89 billion, which is likewise below the preceding year’s P19.73-billion allocation.
“We will continue to build on our efforts to maintain fiscal stability and to improve our revenue collection performance to achieve inclusive economic growth for our country,” Dominguez said. “Our fiscal objectives in the DOF were honed to support the administration’s priority programs, such as the massive infrastructure program and public investments to improve the lives of our people.”
Sultan Kudarat Rep. Horacio Suansing, one of the senior vice chairpersons of the House appropriations committee, sponsored the DOF budget before the House plenary.
In his sponsorship speech, Suansing cited the sound fiscal policies and reform measures implemented in the first half of the Duterte administration, such as the Tax Reform for Acceleration and Inclusion (TRAIN) law that has led to double-digit growth in tax collections and a higher investment-grade credit rating of BBB-Plus for the Philippines, which is only a step away from the sterling “A” territory.
“These reforms and substantive gains enable us to fund critical government programs—programs badly needed by our constituents. Hence, it is but prudent to equip the Department of Finance and its attached agencies with sufficient budget to keep this momentum of fiscal reforms and gains,” Suansing said in endorsing the approval of the DOF budget for 2020.
If automatic appropriations, unprogrammed appropriations and budgetary support for government-owned and -controlled corporations (GOCCs) are included, the DOF’s total budget for 2020 amounts to P56 billion.
The DOF’s automatic appropriations of P1.4 billion, covers retirement and life insurance premiums of P720 million and special accounts in the General Fund of P700 million.
Its unprogrammed appropriations of P211 million include the refund of the service development fee for the Nampedai property in Japan, while the budgetary support to GOCCs includes the P36.4 billion for the cash transfers under the Tax Reform for Acceleration and Inclusion Act (TRAIN), and P97 million for the implementation of the specialized tax training and education management program of the Philippine Tax Academy (PTA).
The unprogrammed funds also cover the P500-million subsidy for the Trade and Investment Development Corp. of the Philippines (TIDCORP) for its capacity to cover additional guarantee volume it committed to deliver in 2020. This is to address the monitoring by the Bangko Sentral ng Pilipinas (BSP) of capital adequacy and TIDCORP’s liquidity.
Among the DOF-attached agencies, the Bureau of Internal Revenue (BIR) got the largest allocation of P8.46 billion to further improve the agency’s tax administration and enforcement capabilities.
The BIR’s budget for personnel services rose in 2020, as it plans to increase its filled-up positions from 10,671 this year to 11,448 in 2020.
The agencies with the biggest reduction in the proposed 2020 budget are the Bureaus of the Treasury (BTr) and of Customs (BOC).
BTr’s proposed budget of P4.77 billion for 2020 dropped P1.3 billion or 21 percent compared to its 2019 appropriations of P6.04 billion as it would be paying this year the final installment of the paid-in capital of the country to the Asian Infrastructure Investment Bank (AIIB).
Its proposed budget also maintained the P2-billion insurance premium for government assets against natural or human-induced calamities, epidemics, crises, and catastrophes.
The non-approval of the Medium-Term Information and Communications Technology Harmonization Initiative (MITHI) projects of the BOC under its modernization program led to a 14-percent decrease in its proposed budget for 2020 of P2.26 billion as compared to the bureau’s appropriations this year of P2.62 billion.
For the Office of the Secretary (OSEC), its proposed budget for 2020 of P836.61 million decreased by 1 percent from this year’s P843.33 million.
The budget of the Securities and Exchange Commission (SEC) of P550.68 million decreased by 11 percent from this year’s P618.43 million.
The remaining five DOF-attached agencies with a total proposed budget of P421.44 million is only 2 percent of the general appropriations of the proposed 2020 DOF budget.
These agencies are the Bureau of Local Government Finance (BLGF), P259.48 million; Privatization Management Office (PMO), P81.54 million; National Tax Research Center (NTRC), P62.26 million; Central Board of Assessment and Appeals (CBAA), P18.16 million; and Insurance Commission (IC), P6,000.
The IC sources its funds for personal services from the retained amount of the fees, charges and other income derived from the regulation of pre-need companies, while its maintenance and other operating expenses (MOOE) comes from its 25 share from the premium tax collection of the BIR.