The Bureau of Customs (BOC) has surpassed its target for May 2017 by 2.77 percent, collecting a total of P39.34 billion, which represents a 23.52 percent hike compared to the same period in 2016 when collections reached P31.85 billion.

In a report to Finance Secretary Carlos Dominguez III, BOC Commissioner Nicanor Faeldon also said that for the first five months of 2017, the Bureau collected a total of P176.06 billion, just 1.69 percent shy of the year-to-date target of P179.08 percent.

The figure also represents an improvement of 13.54 percent over the collections of P155.06 billion for the January-May period.

Faeldon said that for the period of May 1 to 31, 2017, the BOC collected P39.27 billion in cash revenues and P70 million from its Tax Expenditure Fund (TEF), which represents import duties and taxes of state-owned firms.

In the January-May period, the BOC collected cash revenues totaling P175.62 billion and P440 million from the TEF, Faeldon added.

The BOC earlier announced that it collected P104.9 billion in taxes in the first quarter of 2017, exceeding the P104.28 billion target for the period.

It expects to collect P468 billion this year, up from the 2016 level of P396.37 billion.

Earlier, Dominguez exhorted BOC officials and employees to transform the agency into “a truly modern bureaucratic organization,” given that the agency and the Bureau of Internal Revenue (BIR) are the two primary revenue tools that the government relies on to support its growth strategy anchored on massive public investments in infrastructure, human capital and social protection for the poor and other vulnerable sectors.

The finance chief said that modernization will also enable the BOC to better facilitate trade, fight smuggling and bar the entry of illegal drugs and terrorists from the country’s borders.

Dominguez said the Duterte administration’s ambitious spending plan will require immense revenue inflows on top of the official development assistance that the government expects to get from other countries in the medium term.

“The role of the Bureau of Customs is more than just improving revenue collection to provide government the wherewithal to fund public investments. We expect the Bureau to continuously improve its procedures and processes to facilitate trade. This is important in building an investments-led growth that will produce employment opportunities for our people,” Dominguez said at a recent BOC command conference.

Dominguez said agencies like the BOC and the BIR do not actually collect for the government, but “for the people of the Philippines,” with the State only allocating how the taxes and duties it collects would be spent.

“So when people are cheating and not paying their right taxes or duties, they are not cheating the government, they are cheating the Filipino people. So you are the guardians of that. You should keep that in mind, that these funds don’t belong to the government, they belong to the Filipino people. We are just entrusted to collect it and to allocate it. You are collecting on behalf of the Filipino people,” Dominguez told the bureau’s officers and employees.

Dominguez said all BOC officers and employees play “an important and patriotic role in this government’s effort to liberate millions of Filipinos from poverty” as their ability to collect taxes “is important to ensuring fiscal stability as we embark on an ambitious strategy to bring our economy to a higher plane of growth.”

This growth strategy will provide the means that would enable the government to bring down the poverty rate from 21.6 percent in 2015 to only 14 percent by 2022, Dominguez said.

The Duterte administration also aims to transform the country into a high middle-income one by 2022 and to a high-income economy in one generation or by 2040.

On top of improving revenue collections, Dominguez said the approval of the first package of the Comprehensive Tax Reform Program (CTRP) is crucial to the financial viability of the Duterte administration’s higher public spending policy because it aims to correct the tax system’s “inherent flaws, such as non-indexation to inflation of the tax rates and the large scope of exemptions and special treatments that complicates tax administration.”

The CTRP’s first package—the Tax Reform Acceleration and Inclusion Act outlined in House Bill 5636—was approved on final reading last May 31 by an overwhelming majority in the House of Representatives. The bill will be tackled by the Senate when the Congress reopens for its second regular session in July.