DOF statement on Fiscal Performance January to September 2010

Statement of Finance Secretary Cesar V. Purisima, October 21, 2010

“For the first nine months, total revenues posted a 7% year-on-year growth reaching P894.72 billion versus the P839.81 billion last year. Year to date, total revenues of the Bureau of Internal Revenue (BIR) (P607.33 billion) grew by 9% y-o-y.  Meanwhile, Bureau of Customs (BOC) collections reached P190.95 billion or 15% higher than last year’s P165.40 billion.  Both cash collections of the BIR and BOC for the first nine months increased double digit by 12% and 18%, respectively.

“”The BIR continues to perform well exceeding its target in September on account of the intensified implementation of the RATE Program.  Total revenues accounted for by the BIR reached P60.96 billion or P1.06 billion higher than its monthly target of P59.89 billion and higher by 8.4% over the same period last year. Cash collections comprised 98.11% of total BIR revenue collections.  For the third quarter, BIR cash collections reached P200.92 billion or 13% higher y-o-y reflecting this Administration’s seriousness in increasing tax take.

“”Third quarter cash collections of BOC reached P59.04 billion which is 11% higher than last year. However, total collection of the BOC for September reached P20.23 billion below its monthly target of P26.56 billion as cash collection fell short of its target by 17%.  The lower than target cash collection can be attributed to a) the heavy utilization of oil industry players of the tax credit instrument; b) the impact of zero tariff on imported oil and motor vehicles from Japan due to the implementation of the JPEPA; and c) prevailing zero tariff on wheat, cement and steel and the reduced, if not zero, duties being enjoyed by dozens of other products in compliance with the country’s various international, multi-lateral and bilateral agreements (i.e. AFTA and JPEPA).

“Meanwhile, expenditures for the month of September reached only P123.58 billion or 16% below the program of P147.22 billion as operating expenses and interest payments were below the program by 15% and 20%, respectively. Given the frontloading in the first half, the national government is carefully calibrating spending as we try to keep the deficit in check and within full year program.  Notwithstanding, we will make sure that we do not sacrifice economic growth while we pursue prudent expenditure discipline.  This brings national government deficit to P31.68 billion in September 2010 slightly higher than the P27.51 billion deficit posted in the same month last year.

“Total expenditures from January to September reached P1.15 trillion up by 7% over the P1.08 trillion in the same period last year.  This is however, below the program of P1.21 trillion.

“On the back of serious tax enforcement and expenditure discipline, the national government’s deficit for the first nine months stood at P259.79 billion which is P13.87 billion below the program of P273.66 billion.  We believe that the disciplined approach of this Administration to spending will strengthen the fiscal position moving forward.

“Let me reiterate that this Administration remains focused on its good governance agenda with emphasis on tax enforcement and expenditure discipline.  We will pursue our economic objectives of sustainable economic growth and poverty reduction within a sound fiscal framework.


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