The Philippine government said it will act on recommendations from the World Bank’s latest Public Finance Review, putting a sharper focus on broadening the tax base, improving revenue collection and ensuring that public spending translates into measurable gains for Filipinos.
Finance Secretary Frederick Go said the government’s challenge is to rebuild fiscal buffers without undermining economic growth, as debt and deficits remain elevated compared with pre-pandemic levels.
“Our debt and deficits, while manageable, remain above where they were before the pandemic,” Go said Monday at the launch of the review.
On tax policy, Go said the government sees more room to raise revenues by bringing more economic activity into the tax net rather than increasing statutory rates.
“Our tax rates are broadly in line with our regional peers,” he said. “The path forward is not to raise statutory rates, but to broaden the base.”
The approach includes tightening tax exemptions and improving compliance and collections through simpler regulations, artificial intelligence and digital technologies.
Go said the Department of Finance will study the World Bank’s recommendations as it works to “sharpen our approach to revenue mobilization and tax policy design.”
The government’s fiscal agenda, however, extends beyond revenue generation.
Budget Secretary Kim Robert de Leon said the quality and impact of government spending must be measured alongside revenue gains and budget utilization.
“We finance outcomes, not paperwork,” De Leon said. “A 100% utilization rate may look impressive on a report, but if the intended beneficiary did not feel the improvement, then we still have a question to answer.”
That puts implementation at the center of the government’s response to the World Bank review, he said.
“A reform written is not yet a reform delivered,” De Leon said. “A recommendation matters only when institutions act on it.”
For De Leon, the test of fiscal reform is ultimately whether government resources produce tangible public benefits.
“Government spending becomes meaningful only when public money becomes public good,” he said.
