Salceda: Government revenue effort remains resilient

The chairman of the House of Representatives’ Committee on Ways and Means on Monday lauded the strength of the national government’s revenue effort despite the COVID-19 pandemic.

Albay Rep. Joey Sarte Salceda, in his presentation of the country’s fiscal status during the regular meeting of the House tax committee Monday, noted that “unlike in previous crises, the revenue effort did not collapse this time, even with the deadline extensions and other tax relief that we gave.”

“Revenue effort remained very strong, only slightly declining from 16.08 percent in 2019, one of the highest ever, to 15.89 percent in 2020. Tax reforms passed by this committee form the foundation of our strongest revenue performance during any recent global crisis,” Salceda, the House ways and means chairperson, said.

Revenue effort is the amount of national government revenues collected during a fiscal year over the same year’s gross domestic product.

Salceda noted that the revenue effort for 2020 is the first major economic crisis where the country’s revenue effort did not collapse massively.

The House tax chair credited this to the “close relationship between fiscal administration (DOF, BIR, BOC, GOCCs) and fiscal policymakers (Ways and Means Committee)” and to the vigilance of the House tax committee in investigating tax enforcement and administration.

“Tax reforms are the foundation of our fiscal strength. Our children and grandchildren will have government revenues for their time, because we invested in good tax policy,” Salceda added.

Salceda is the principal author of the entire Comprehensive Tax Reform Program of the Duterte administration.

“The DOF and the House Ways and Means Committee work constructively but independently. That’s how we serve as a check and balance to each other. And it works well, as the numbers show,” Salceda added.

“My Vice Chairs, Rep. (Janette) Garin (of Iloilo) and Rep. (Estrellita) Suansing (of Nueva Ecija) also do an excellent job with oversight and investigation. That helps improve tax administration,” Salceda added.

According to releases from the Department of Finance, which Salceda cited, the BIR outperformed target by P213.84 billion or 12.68 percent in excess of the revised Development Budget Coordinating Committee target of P1.685 trillion for the year. Meanwhile, the BOC outperformed its revised target by P32.55 billion or 6.49 percent above DBCC target of P501.33 billion.

The 2020 deficit was also P444 billion smaller than anticipated by the DBCC in July 2020.

“This means we have the fiscal space for more lifeline relief during this critical period. We are probably bound for small, localized lockdowns during this second wave. That will delay economic recovery. So, we need to be open to more relief in the meantime. Once the economy reopens, let’s go big with a stimulus package that will pump-prime consumption,” Salceda added.

Salceda is also co-chair of the Economic Stimulus and Recovery Cluster of the House Defeat COVID-19 Committee.

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