Revenues collections of the Bureau of Internal Revenue and Bureau of Customs fell P10.17 billion in the first quarter to P600.86 billion from a year ago, pulled down by the implementation of the enhanced community quarantine in Luzon amid the coronavirus disease 2019 pandemic, according to the Finance Department.
Data showed the first-quarter collection was P156.26 billion short of the P757.12-billion revenue target for the period.
“Collections for March took the biggest hit, as both bureaus only hauled in a combined P163.15 billion for the month, or P34.5 billion lower than the P197.64-billion take for the same month last year, and P85.36 billion short of the target of P248.5 billion for the period,” the agency said.
The government imposed the ECQ in Luzon on March 16 to slow the spread of the coronavirus disease 2019 and extended it until April 30. Local government units in the Visayas and Luzon also implemented similar containment measures.
The Finance Department announced the decline in revenue collection while it was trying to raise billions of pesos for the massive subsidy program to help millions of poor families and workers displaced by the lockdown.
Finance Secretary Carlos Dominguez III said estimates by the Development Budget Coordination Committee showed that if the economy would post zero growth this year because of the health, social and economic impacts of the pandemic, the government would lose around P286.4 billion in revenues.
A 1-percent contraction in the gross domestic product would result in revenue decline of P318 billion.
The DBCC earlier projected that the BIR and BOC would collect P3.307 trillion in combined revenues in 2020. The BIR was tasked to collect P2.576 trillion of the target, while the BOC was supposed to raise P731 billion.
“Our tax collections are definitely going to be a bit lower than our original target but as I said, these are things that we can finance,” Dominguez said.
Data showed that the BIR collected P455.45 billion in the first thee months, 2.86 percent or P13.41 billion below the P468.86-billion collection in the same period last year. It was also 22.86 percent short of the BIR’s P590.43-billion target for the period.
The BIR’s Large Taxpayers Service collected P284.39 billion in the three-month period, down 6.14 percent from last year’s figure of P302.98 billion.
The LTS also failed to reach its target of P386.19 billion for the period, falling short by 26.36 percent or P101.81 billion.
BIR collections amounted to P118.35 billion in March, which was P29.71 billion or 20.06 percent lower than last year’s P148.05 billion. The shortfall from the March target of P190.48 billion was 38 percent or P72.14 billion.
Meanwhile, Customs collections slightly rose 2.3 percent in the first quarter to P145.41 billion from P142.17 billion a year earlier. The figure, however, was 12.76 percent or P21.28 billion short of the P166.69-billion target for the period.
Customs collections in March fell to P44.8 billion from P49.59 billion in the same month last year. It was also 22.78 percent or P13.22 billion short of the March target of P58.02 billion.
Dominguez said even with the decline in revenue collections in the first quarter, the government was “financially able” to meet the unexpected challenges of the pandemic because President Rodrigo Duterte ordered economic managers since the beginning of his term to maintain fiscal discipline and exercise prudence in state spending.
He cited said the gross domestic product growth averaged 6.4 percent since President Duterte took over in 2016 while the revenue effort or collection from taxes and other sources reached 16.9 percent in 2019, the highest in 22 years.
Dominguez said the Philippines also maintained a manageable debt-to-GDP ratio of 41.5 percent in 2019, a vast improvement from 70 percent in the past.
Inflation also remained low at 2.5 percent in March, within the 2020 target range of 2 percent to 4 percent.