With only a few more months left for the current administration, Finance Secretary Carlos Dominguez III on Tuesday said the Department of Finance (DOF) is preparing its fiscal consolidation proposal which will likely improve tax hikes to repay the country’s increasing debt.
Speaking before the Financial Executives Institute of the Philippines (FINEX), Dominguez said the proposal will include measures which would generate revenues for the country to pay for debts incurred due to the COVID-19 pandemic.
“We are just putting the final touches on our fiscal consolidation plan and we are not… At this point I don’t have a complete package but certainly, looking realistically at our situation, we have to pay for COVID,” Dominguez said.
“I mean, we cannot just have COVID and not pay for it okay. You don’t know how much we spent in just paying for the vaccines,” he added.
Latest data from the DOF indicate that the country has raised a total of $22.55 billion in budgetary support financing as of January 14, 2022.
This includes agreements made with the Asian Development Bank, the World Bank, the Asian Infrastructure Investment Bank, the Agence Française de Développement, the Japan International Cooperation Agency, the Bank of Korea Economic Development Co-operation Fund, and foreign currency denominated global bonds.
“Again I tell you, doing tax reform, doing any reform requires a lot of planning and a lot of strategic thinking. You cannot just go there and start waving a banner and say, ‘Oh, we’ll do this, we’ll do that,’ you can’t do it,” Dominguez said Tuesday.
“You have to sit down, think about it, think who your enemies are, think who your friends are, and hopefully your enemies make mistakes and that you don’t,” he continued.
Under the leadership of Dominguez, the DOF spearheaded the Duterte administration’s tax reform program with measures such as the Tax Reform for Acceleration and Inclusion (TRAIN), and the Corporate Recovery and Tax Incentives for Enterprises (CREATE).
“Reforming the tax system in this country required a lot of confidence and it was a confidence building exercise,” Dominguez said. —NB, GMA News