2018 proposed budget lowered to P3.77 T
During a press briefing of the Development Budget Coordination Committee (DBCC) yesterday, Budget Secretary Benjamin Diokno said there was a slight reduction in the proposed budget ceiling for 2018 due to the watered down tax reform package approved by the House of Representatives last June 1. Krizjohn Rosales, file
MANILA, Philippines - The country’s economic managers have lowered its estimated national budget ceiling for 2018 from the earlier programmed P3.84 trillion to P3.767 trillion owing to revisions in the tax reform measure.
During a press briefing of the Development Budget Coordination Committee (DBCC) yesterday, Budget Secretary Benjamin Diokno said there was a slight reduction in the proposed budget ceiling for 2018 due to the watered down tax reform package approved by the House of Representatives last June 1.
“It’s because of the adjustments made by the House,” Diokno said.
According to Department of Finance estimates, House Bill 5636, or the Tax Reform for Acceleration and Inclusion Act, is expected to generate P133.8 billion in additional revenues in 2018.
This is lower compared to the P157.2 billion projected under the original Comprehensive Tax Reform Program (CTRP) of the government, plus complementary measures, including the excise tax on sugary beverages.
However, Diokno said the economic managers are still “not giving up” that the Senate and the bicameral committee would be able to reconcile the differences between the bill and the original version.
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Taking into account the impact of the CTRP, the government’s revenue program in 2018 is expected to reach P2.841 trillion, or 16.3 percent of GDP, lower than the P2.99 trillion originally projected.
Disbursements, meanwhile, is seen to reach P3.364 trillion in 2018, resulting in a P523.6-billion budget deficit, equivalent to three percent of GDP.
Meanwhile, Diokno said the country’s economic managers are retaining their macroeconomic assumptions for the medium term.
Inflation assumptions remain stable at two percent to four percent from 2017 to 2022.
GDP growth is expected to remain unchanged at 6.5 percent to 7.5 percent in 2017 and seven percent to eight percent from 2018 to 2022.
The DBCC expects sustained growth momentum to be driven by the intensified infrastructure program and accelerated spending for human capital and social protection.
In terms of foreign exchange, the DBCC retained the projection of P48 to P50 per US dollar in 2017 and adjusted the forecast for 2018 to 2022 to P48 to P51 per US dollar.
The DBCC expects goods imports growth to be at 10 percent from 2017 to 2019 and maintained at 11 percent from 2020 to 2022.
On the other hand, the DBCC has raised its exports growth assumptions from two percent to five percent in 2017, from five percent to seven percent in 2018 and from seven percent to nine percent in 2019.
Thereafter, export growth is expected to be sustained at nine percent from 2020 to 2022.