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Manila Bulletin devider Business devider Banking & Finance devider DOF slams lawmaker for 'fake news' on VAT increase

DOF slams lawmaker for 'fake news' on VAT increase

Published Oct 25, 2025 02:35 pm
Finance Secretary Ralph G. Recto and Cavite 4th District Representative Francisco “Kiko” Barzaga.
Finance Secretary Ralph G. Recto and Cavite 4th District Representative Francisco “Kiko” Barzaga.
While the Department of Finance (DOF) is pushing for the swift enactment of its priority tax measures in the 20th Congress, raising the already eye-sore 12-percent value-added tax (VAT) by three percentage points (ppt) next year is off the table.
In a Facebook post, the DOF called out Cavite 4th District Representative Francisco “Kiko” Barzaga for posting on his Facebook page a claim that Finance Secretary Ralph G. Recto plans to increase the 12-percent VAT to 15 percent by the first quarter of 2026.
According to the DOF, the news about the VAT hike is “not true” and that “there are no new or additional taxes that will be imposed on the public.”
“A call to all elected officials: be responsible and do not become purveyors of fake news,” the DOF further said.
To back its statement, the DOF asserted that the country’s main tax authorities—the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC)—have “sufficient capacity to raise funds through digitalization, stricter enforcement, and plugging leakages in the tax system.”
It added that the government is also strengthening non-tax revenues through “higher dividend contributions from government-owned and -controlled corporations (GOCCs) and the privatization of government assets.”
Total dividends remitted by GOCCs as of end-September reached P106.5 billion, 76.9 percent of last year’s total of P138.5 billion. Earlier, Recto said dividend collections from GOCCs could reach P157 billion by the end of the year.
Meanwhile, non-tax revenues dropped 34.7 percent to ₱314.1 billion from ₱481.0 billion a year earlier. This massive drop was blamed on the “base effect of extraordinary non-recurring remittances in 2024.
For this year, the DOF is also confident that the government remains on track with its revenue collection to support programs in health, education, agriculture, infrastructure, technology, and social protection.
Total revenues collected through September reached ₱3.37 trillion, 2.2 percent higher than last year’s ₱3.29 trillion. This is 74.6 percent of the revised full-year target of ₱4.52 trillion.
Barzaga filed House Bill (HB) 5119 early this month, seeking to scrap the existing VAT rate.

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Department of Finance (DOF) Finance Secretary Ralph G. Recto Kiko Barzaga
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