dof seeks lower
|

DOF seeks lower P32-billion budget for 2027 despite lofty revenue goals

ByJustpaste.in

MANILA, Philippines – The Marcos administration is proposing a P32-billion spending program for the Department of Finance (DOF) and its attached agencies in 2027, with the Bureau of Internal Revenue (BIR) receiving the biggest share at nearly 63%.

Of the DOF’s total amount in the 2027 National Expenditure Program (NEP), P28.6 billion consists of new appropriations that Congress is being asked to approve. The remaining P3.4 billion will come from automatic appropriations, including special accounts.

The proposed DOF budget is 3.5% lower than the P33.19 billion enacted for 2026, even as the proposed P7.2-trillion national budget has risen overall. It is also lower than the P37.8-billion spending program originally proposed for the DOF in the 2026 NEP.

Personnel services account for P16.66 billion, or 52% of the full DOF spending program. Maintenance and other operating expenses receive P11.11 billion (35%), while capital outlays get P4.24 billion (13%). Another P25.12 million is set aside for financial expenses.

The proposed total agency budgets, including funding sources outside new appropriations, are:

  • BIR: P19.40 billion, up 6.9% from P18.15 billion in 2026
  • Bureau of Customs (BOC): P5.90 billion, down 9.7% from P6.53 billion
  • Bureau of the Treasury (BTr): P4.05 billion, down 13.7% from P4.70 billion
  • DOF Office of the Secretary: P1.15 billion, down 13% from P1.32 billion
  • Insurance Commission: P656.69 million, down 44.7% from P1.19 billion
  • Bureau of Local Government Finance (BLGF): P568.54 million, down 42.9% from P996.20 million
  • National Tax Research Center: P148.37 million, down 3.6% from P153.95 million
  • Privatization and Management Office: P134.80 million, almost unchanged from 2026
  • Central Board of Assessment Appeals: P24.74 million, up 34.9% from P18.34 million

The Securities and Exchange Commission (SEC) has no regular line-item appropriation in the summary. Its charter and a special provision instead allow it to retain fees, fines, and other charges for operations and modernization, as well as P100 million from securities registration income.

BIR gets the biggest share

The BIR accounts for 62.8% of the full DOF proposed budget. The bureau’s biggest program is the enforcement of internal revenue laws, which receives P10.31 billion in new appropriations. 

Of this amount, P7.45 billion goes to personnel services, P2.84 billion covers operating expenses such as rent, utilities, security, travel, supplies, and professional services, and P11.98 million is allocated for capital outlays.

It’s also spending P3.9 billion for revenue information systems and infrastructure support, which is 21% higher than its P3.2-billion funding level in 2026.

The spending comes as the government asks the BIR to collect P3.736 trillion in 2027, 10.1% more than its revised target this year. Customs is expected to collect another P1.074 trillion. Together, they have the burden of generating more than 90% of the government’s P5.205-trillion revenue program.

Customs confidential funds return to lower level

For 2027, the administration is proposing P69.5 million in confidential funds for Customs, a 72% reduction from the P250 million enacted for 2026. 

Customs received P250 million in confidential funds under the 2026 General Appropriations Act, up from P69.5 million in the executive’s original proposal. The increase appears to have been placed under surveillance and prevention of smuggling. Funding for operating expenses under that activity rose by exactly the same amount, from P386.57 million in the 2026 NEP to P567.07 million in the enacted 2026 budget. 

Makabayan lawmakers questioned the broader increase in confidential and intelligence funds during the 2026 budget process, but the final budget retained the Customs increase.

Customs later defended its use of confidential and intelligence funds after lawmakers questioned why illicit tobacco remained widespread despite the bureau’s enforcement resources. Bureau of Customs Commissioner Ariel Nepomuceno said the spending was well worth it, compared with the value of contraband seized by Customs. 

Must Read

PDIC lost P107B. Why is only P57B in the 2027 proposed budget — and not guaranteed?


PDIC lost P107B. Why is only P57B in the 2027 proposed budget — and not guaranteed?

DOF’s outlook for the budget, deficit

At the House development budget coordination committee briefing on August 17, Finance Secretary Frederick Go presented the government’s revenue and financing program and said the objective was “not to spend less, but to spend better.”

The government expects the deficit to reach around P1.66 trillion, equivalent to 5.4% of gross domestic product, in 2026. The deficit is the difference between what the government collects and what it spends, while the deficit-to-GDP ratio measures the size of that borrowing requirement relative to the economy.

The ratio is projected to decline further to 5.1% in 2027 and 3.5% by 2030. However, the deficit is still expected to rise slightly in peso terms to P1.69 trillion in 2027 as the government continues to spend more than it collects. 

The NEP remains an executive proposal that Congress may amend before passing the budget into law. – Rappler.com

Must Read

Your A-Z guide to the national budget


Your A-Z guide to the national budget

Similar Posts

  • | |

    Russia extends fuel export ban until January 2027

    ByJustpaste.in

    Russia has extended its ban on diesel and petrol exports until January 31, 2027, as the government seeks to stabilise domestic fuel supplies and curb rising prices. In a statement, the Russian government said the export restrictions will remain in force until the end of January next year. The move is aimed at ensuring adequate fuel availability in the domestic market amid continued pressure on the country’s energy sector. The latest decision follows an earlier temporary ban on diesel exports that was imposed from July 8 to July 31. Russia has also previously restricted exports of petrol and jet fuel in an effort to address supply shortages at home. According to reports, the export curbs come after repeated Ukrainian drone attacks on Russian oil refineries, which have disrupted refining operations and reduced fuel production in several regions. The attacks have contributed to fuel shortages and rising domestic prices, prompting authorities to prioritise local demand over exports. The government believes extending the restrictions will help ease pressure on consumers and maintain stability in the country’s fuel market. Russia is one of the world’s leading exporters of refined petroleum products, and any changes to its export policy are closely monitored by global energy markets. Analysts say prolonged export restrictions could influence regional fuel supplies and international energy prices if they remain in place for an extended period. The government has not indicated whether the ban will be lifted before the January deadline, saying it will continue to monitor domestic fuel availability and market conditions.

  • | | |

    Economists urge SBP to hold rate at 11.5%

    ByJustpaste.in

    Economists have recommended that the State Bank of Pakistan (SBP) keep its policy rate unchanged at 11.5% at its upcoming monetary policy meeting on July 27. The recommendation comes as inflation has started to ease, but underlying price pressures remain high. Analysts believe the economy is also recovering unevenly, leaving limited room for another increase in borrowing costs. A recent economic assessment showed that headline inflation fell to 11.1% in June. However, core inflation remained elevated. Urban core inflation stood at 8.7%, while rural core inflation was recorded at 7.9%. Economists said much of the current inflationary pressure is coming from food, energy, transport and government-controlled prices. These factors cannot be addressed effectively through interest-rate changes alone. They also warned that a recent increase in the Sensitive Price Indicator (SPI) requires close monitoring. The development could indicate that the decline in inflation has not yet become firmly established. Financial market indicators also support maintaining the current policy rate. Short-term Treasury bill yields remain close to the SBP’s existing rate, while the overnight interest rate is also broadly aligned with the current monetary policy stance. However, yields on longer-term Treasury bills have increased. The six-month yield reached 11.80%, while the 12-month yield rose to 11.99%. Economists said the movement reflects some caution about the medium-term economic outlook. The assessment noted that Pakistan’s economic recovery has gained momentum but remains uneven. Large-scale manufacturing continues to face challenges, while there are no strong signs of excessive demand that would require another rate hike. Economists warned that raising the policy rate further could increase borrowing costs for businesses and consumers. It could also discourage investment and slow economic activity without directly tackling the supply-side factors behind current inflation. Pakistan’s external position has improved in recent months. Higher foreign exchange reserves, strong remittance inflows and relative stability in the exchange rate have reduced immediate pressure on the economy. Despite these improvements, risks remain. The country continues to face a sizeable merchandise trade deficit and upcoming external debt repayments. Heavy dependence on imported energy also leaves Pakistan vulnerable to international oil price fluctuations. A sharp rise in global oil prices could increase transportation and energy costs in Pakistan. It could also widen external pressures and trigger another round of inflation. Persistent core inflation is another major concern. If underlying price pressures remain high, inflation expectations could become difficult to control. This could delay any reduction in interest rates or force the central bank to consider tighter monetary policy. A weakening exchange rate could create additional pressure by making imports more expensive. It could also affect foreign exchange reserves and increase imported inflation. Economists have therefore advised the SBP to closely monitor private-sector borrowing, lending rates, monetary growth and the difference between short- and long-term interest rates. For now, the indicators favour maintaining the policy rate at 11.5%. However, economists say the central bank should remain ready to adjust its stance if inflation, oil prices, exchange-rate pressures or external financing risks deteriorate.

  • | | |

    PSX surges 5,335 points as investor confidence str…

    ByJustpaste.in

    Stock Exchange (PSX) recorded a strong performance during the outgoing business week, with the benchmark 100 Index gaining 5,335 points amid renewed investor confidence. The KSE-100 Index closed the week at 181,430 points, marking a significant rise from the previous level. During the week, the index traded within a range of 4,963 points, reaching a high of 182,007 points while its lowest level stood at 177,043 points. Trading activity also remained robust, with approximately 3.74 billion shares changing hands during the week at a total value of around Rs169 billion. The positive momentum was further reflected in the overall market valuation. The market capitalisation of the PSX increased by Rs482 billion over the week, reaching Rs20.237 trillion. Market sentiment remained positive as investors closely monitored developments surrounding the Iran-US conflict and signs of a possible pause in hostilities, which helped support confidence in the local equity market.

Leave a Reply

Your email address will not be published. Required fields are marked *