By Benjamin Cuaresma
MANILA — The country’s two largest revenue-generating agencies remain optimistic that they can achieve their revised 2026 collection targets despite lingering economic uncertainties, with the Bureau of Internal Revenue (BIR) banking on stronger domestic economic activity and the Bureau of Customs (BOC) relying on improved import valuation and assessment.
The Development Budget Coordination Committee (DBCC) recently adjusted the government’s revenue goals by trimming the BIR’s collection target by ₱38 billion to ₱3.393 trillion, while increasing the BOC’s target by ₱7 billion to ₱1.011 trillion.
Although the BIR’s target was lowered, Commissioner Charlie Mendoza acknowledged that the revised goal remains ambitious, noting that it still exceeds last year’s collection target of ₱3.2 trillion.
“We remain hopeful that stronger GDP growth in the coming months will drive higher collections from value-added tax, percentage tax, and other business-related taxes,” Mendoza said, stressing that increased economic activity directly translates into higher government revenues.
He also emphasized that the agency’s ongoing digitalization initiatives and taxpayer education programs are expected to make tax compliance easier, encouraging more taxpayers to file and pay on time.
“Our objective is simple—make compliance more convenient. When paying taxes becomes easier, revenue collections naturally improve,” he added.
The Philippine economy expanded by only 2.8 percent during the first quarter of 2026, with analysts expecting growth to remain modest in the second quarter due to the economic effects of tensions in the Middle East.
Despite these headwinds, Mendoza expressed confidence that the BIR remains on track to meet its revised target.
Preliminary figures indicate that June collections surpassed those recorded during the same period last year, although the pace of growth may have moderated because of the high collection base created by last year’s estate tax amnesty deadline.
From January to May, the BIR collected ₱1.434 trillion, exceeding its programmed target by ₱9.7 billion and already achieving about 42 percent of its revised annual goal.
Customs Eyes Higher Collections
Meanwhile, Customs Commissioner Ariel Nepomuceno said the higher revenue target likely reflects government assumptions that the peso will average between ₱61 and ₱62 against the US dollar this year.
A weaker peso increases the peso value of imported goods, resulting in higher customs duties and tax collections.
Nepomuceno, however, stressed that exchange rates alone will not drive revenue growth.
Instead, the bureau intends to gradually improve its assessment rate—the amount of duties and taxes collected relative to the value of imported goods.
“There are many imported products where improving our assessment rate can significantly increase revenues, but this has to be done gradually and systematically,” he said.
As of mid-July, the BOC had already recorded a ₱11.8-billion surplus over its collection target—more than enough to offset the additional ₱7-billion increase under the revised DBCC goal.
Latest government data showed the bureau collected ₱491.7 billion from January to June, representing a 7.2-percent increase from the same period last year and equivalent to 48.6 percent of its revised full-year target.
The government’s revised revenue program reflects confidence that stronger tax administration, continued digital reforms, and improving import collections can help sustain fiscal performance even as the economy navigates a challenging global environment.
ia/xf
