₧4-B daily budget hole to be filled with debt By Jovee Marie N. dela Cruz
istration is set to borrow more money to bankroll the national government’s recordhigh P5.768-trillion budget for next year. The government expects better revenue collection next year and is targeting to earn P4.272 trillion from tax and non-tax measures, which is P71 billion higher than its previous target of P4.201 trillion for 2024. “To fully grasp the dimensions of the budget, you have to compute it on a daily basis to fully appreciate the enormity of both spending and borrowing,” Recto said. “In easy-to-remember figures, this is
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HE proposed 2024 national budget of P5.767 trillion translates to an average daily spending of P15.8 billion, but only P11.7 billion of this is supportable by revenues, leaving a P4-billion hole that must be filled with debt, Deputy Speaker and Batangas Rep. Ralph Recto said on Sunday. The Philippines’s outstanding debt at the end of 2024 is projected to reach P15.841 trillion as the Marcos Jr. admin-
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the lowdown: P15.8 billion will be spent per day. But the tax can only fund P11.7 billion. So there is P4 billion to be loaned,” he said. According to Recto, based on the actual disbursements, daily expenses must be covered to the tune of roughly P3.7 billion. Recto said that while the “art of budget marketing perfected by all governments” focuses on what will be spent, “what is downplayed is the enormous money required to finance it.” “Programs that dazzle are highlighted while muting the cost, a great portion
of which is paid by debts left to the next generation to pay,” Recto said. Payment for interest alone on the burgeoning public debt will be around P1.8 billion a day next year, he said. The Marcos Jr. administration will borrow P1.853 trillion next year from the domestic market through the sale of Treasury bills (T-bills) and Treasury bonds (T-bonds). The Bureau of the Treasury will tender P51.050 billion worth of T-bills and P1.802 trillion worth of T-bonds next year. Continued on A4
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PHL ‘MAY OVERSHOOT’ INFLATION TARGET: BSP w
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By Cai U. Ordinario
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Monday, August 7, 2023 Vol. 18 No. 294
P25.00 nationwide | 2 sections 20 pages |
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IVEN recent developments, the Bangko Sentral ng Pilipinas (BSP) said the country may overshoot the inflation target this year. Nonetheless, with various measures to address supply chain issues, the country may still be able to “stick the landing” when it comes to the government’s inflation targets, according to BSP Governor Eli Remolona Jr. The Development Budget Coordination Committee (DBCC) set an inflation target of 2.5 to 4.5 percent this year and 2 to 4 percent next year until 2028.
“We want to stick the landing, as they say in gymnastics,” Remolona said. “We wanna get to the target range without overshooting it too much. I think we will overshoot a little bit pero hindi kami madadapa [but we won’t fall down]. From getting to the target range, I think we can settle comfortably within the 2-4 percent target range.” See “PHL,” A2
DOF may extend low tariff rates on 4 key food items
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HE Department of Finance (DOF) is mulling over extending the reduced tariff rates on four commodities, which includes rice and pork, to keep the country’s inflation rate in check. “We are reviewing the possible extension. We will have a meeting next month to review if we have to extend [the tariff rates],” Finance Secretary Benjamin E. Diokno said in a recent press briefing. The review involves four commodities: rice, corn, pork and fish, according to Finance Undersecretary Zeno Ronald R. Abenoja. The reduced tariff rates on rice, corn and pork are set to expire by yearend as stipulated under President Marcos Jr.’s Executive Order
(EO) 10 series of 2023. Under EO 10, the tariffs for pork range between 15 and 25 percent while corn imports have a tariff rate of 5 to 15 percent. Rice imports are levied with a uniform 35-percent tariff, based on EO 10. The current administration has kept the lower tariffs on the three agricultural commodities until the end of the year “to maintain affordable prices” of food items and “ensure food security” in the country. Abenoja explained that the Inter-Agency Committee on Inflation and Market Outlook (IAC-IMO) has started to review the present tariff rates of the four commodities as well as other drivers of inflation. See “DOF,” A2
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NEWLY caught fish are unloaded at the Parañaque City fish port early on Sunday morning, August 6, 2023. Fish prices are gradually regaining stability following a surge attributed to the recent typhoons that impacted the Philippines. The Department of Finance (DOF) is mulling over extending the reduced tariff rates on four commodities, including fish, to keep the country's inflation rate in check. Story at left, “DOF may extend low tariff rates on 4 key food items.” NONIE REYES
DIGITALIZATION, LEAK PLUGS TO AID BIR’S P3-T GOAL IN ‘24 By Jasper Emmanuel Y. Arcalas @jearcalas
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HE Bureau of Internal Revenue (BIR) is optimistic of hitting its P3.046trillion collection target next year on the back of more aggressive efforts to curb tax leakages and improve efficiency through digitalization of its services. BIR Commissioner Romeo D. Lumagui Jr. said the bureau has already lined-up the measures and programs that it would implement to be able to reach its collection target for 2024, which is P407 billion higher than its P2.639-trillion goal this year. On top of its list, the BIR is preparing for the collection of taxes on online or digital transactions by strengthening its dialogue with the online platforms and online sellers. Last month, the BIR disclosed its plan to start collecting a 1-percent withholding tax
from online sellers by the fourth quarter of the year. Under the 2024 National Expenditure Program (NEP), the BIR is set to collect about P107.52 billion from new and expanded tax measures next year, including nearly P17 billion from value added tax (VAT) on digital service providers. Lumagui said the bureau is also looking to expand its manpower, but noted that it would be challenging since creating additional plantilla items would undergo government scrutiny and processes. “We are hoping to be able to [create more plantilla items]. It is having a growing business wherein you need additional employees to address [t he g row ing needs]. R ight now the number of taxpayers is constantly increasing but the number of [BIR] personnel is not,” he told reporters in a recent interview. See “Digitalization,” A2
‘Rice stocks are more than enough for next few months’
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HE Department of Agriculture (DA) has clarified that National Food Authority (NFA’s) stocks are not at alarming levels, considering the buffer stock at 300,000 to 350,000 metric tons at any given time. “Our rice supply is more than enough for our needs for the next few months,” DA Undersecretary Leocadio Sebastian for Rice Industry Development said. The country’s national buffer stocks must refer to grains– whether palay or milled rice—held by traders from local purchases and imports and households. For her part, DA Undersecretary Mercedita Sombilla for Policy, Planning and Regulation said that, “it would be faulty to compute NFA buffer stocks on the basis of the average national daily consumption of 37,362 MT since NFA stocks are now limited to emergency relief and for the requirements of the Department of Social Welfare and Development [DSWD].” The NFA is mandated by the Rice Tariffication Law (RTL) to buy its
buffer stocks only from local farmers to help them get better rates for their palay. Moreover, the RTL buffer stock study of 2020 said the NFA inventory must be at 300,000 to 350,000 metric tons at any given time. “However, the actual buffer stock of NFA now is only 53,060 MT. We indeed need to increase this level,” Sombilla said. Meanwhi le, Sebast ian has placed the country’s rice supply at 5.7 million metric tons of palay harvested during the dry season and an additional 1.9 million MT of imported rice in stock and 1.8 million MT carry-over stock from 2022. The country also has new harvest in July and August, albeit minimal. Furthermore, DA’s latest bulletin shows that, per the assessment by Regional Field Offices (RFOs) in Cordillera Administrative Region, Ilocos Region, Cagayan Valley, Central Luzon, Calabarzon, Mimaropa, Western Visayas, Zamboanga Continued on A4
PESO EXCHANGE RATES n US 55.3880 n JAPAN 0.3886 n UK 70.4314 n HK 7.0951 n CHINA 7.7232 n SINGAPORE 41.3220 n AUSTRALIA 36.2791 n EU 60.6499 n KOREA 0.0427 n SAUDI ARABIA 14.7764 Source: BSP (August 4, 2023)