House panel scrapes bottom to ensure national budget is fiscally sustainable

Published September 6, 2020, 6:24 PM

by Charissa Luci-Atienza 

House Ways and Means Chair and Albay 2nd District Rep. Joey Sarte Salceda has assured the House leadership that his panel will exhaust all means to ensure that the Philippine government’s economic recovery efforts and the proposed  P4.5 trillion national budget for 2021 are “fiscally sustainable.”


The House leader gave in to the request made by House Speaker Alan Peter S. Cayetano to “help us find the money for the stimulus we need” during the first briefing of the Development Budget Coordinating Committee (DBCC) last Friday. 

“I assure the Speaker and the House leadership that the House Committee on Ways and Means will proactively work with the DBCC members to ensure that our budget is fiscally sustainable,” Salceda said in a statement. 

“We will get the job done,” he assured.

He even noted that there will be enough fiscal space for the 2021 budget.

“At least on the House’s part, I can assure you, we will have no problem. There will be fiscal space for the 2021 budget.” 

Salceda, who also serves as the vice chairperson of the House Committee on Appropriations, noted that measures that would generate about P50.25 billion in the first year of their implementation already hurdled his panel.

Among these bills are the updating of rates for the motor vehicle road users’ tax (MVRUT), higher taxes on Philippine Offshore Gaming Operations (POGOs), and tax administration measures on the digital economy to plug loopholes currently used by large corporations, he said. 

“The most obvious first step is to pass the POGO taxes, since China’s economy is already starting to recover. The POGOs have nowhere to go, since gambling is almost entirely banned in the rest of ASEAN. We will revisit the MVRUT in view of the hit the transport sector has taken. Under the proposal, most of the revenues from private cars are already devoted to helping the public transport sector, but we will see how we can enhance the fairness of the measure more, given that we passed it before COVID-19,” the House leader said. 

“As for tax administration reforms on the digital economy, I have secured exemptions for small businesses. Online barter trade will also absolutely not be taxed,” he added.

Citing that his panel’s work involves oversight of tax administration,  Salceda said they have conducted regular meetings to combat technical smuggling and abuse of the customs bonded warehouses.

He said they are also keeping an eye on the digitalization of the revenue-generating agencies, including the Bureau of Customs (BOC) and the Bureau of Internal Revenue (BIR).

“We are just waiting for the Department of Finance to submit their proposals for making tax compliance digitally compatible. My office is also drafting counterpart proposals to boost taxpayer compliance and make the taxpaying experience easier,” he said. 

He enthused that the  government’s revenues will recover in 2021. 

“My committee has worked very hard on tax reform. We passed all of the packages already. Once the economy recovers, I expect the sin tax reform, which I championed, to deliver historic revenue gains in 2021,” Salceda said.

He noted that the BOC already breached its revised 2020 revenue targets for the third consecutive month last August, while the BIR  has not yet submitted its August figures, but also breached its targets for June and July.

“The revenues are already recovering as we reopen the economy more. So, an indirect part of my committee’s work is really ensuring that we no longer need to shut the economy down, because our health capacity can take the cases as they come,” Salceda said.

“That’s why I took an active role in monitoring the COVID-19 response and recommending measures to the IATF (Inter Agency Task Force),” Salceda said.