Finance Secretary Carlos Dominguez III said Tuesday the sustained robust tax collections and vigorous implementation of administrative reforms by the Bureau of Internal Revenue (BIR) will help the country achieve its goal of eradicating extreme poverty within one generation.

President Duterte’s 2016 campaign promise of effecting real change has become doable now that the BIR, which breached the P2-trillion mark in tax collections last year, has been helping raise enough revenues for the government to spend big on infrastructure and social services to realize the goal of improving the lives of all law-abiding Filipinos, Dominguez said.

The BIR raised P2.18 trillion in revenues in 2019, which is an 11.3 percent improvement over the 2018 figure and resulted in the Philippines raising its tax effort to 15.1 percent of gross domestic product (GDP), its best rate in 22 years, he noted.

Dominguez said he is confident the BIR’s performance this year will continue to improve under the leadership of BIR Commissioner Caesar Dulay this coming tax season, given the passage and implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) Law, the Tax Amnesty Act, and the recently signed laws increasing excise taxes on alcohol, tobacco and vapor (vaping) products and e-cigarettes.

These revenue collection efforts will be supported by the BIR’s digitalization efforts and other administrative reforms to widen the tax base and simplify the process of tax collection, he said.

“Clearly, the BIR is the spear point in our nation’s progress. So, as you go out there, building partnerships with our taxpayers in the framework of a dynamic modern tax system, remember that you are not just producing revenues. You are creating a better future for this country,” Dominguez said during the kick-off ceremonies of the bureau’s National Tax Campaign at the Philippine International Convention Center (PICC) in Pasay City.

He said the BIR “is gifted with talented professionals who know how to get the job done.”

“I trust that the Bureau will once more overshoot its targets with the able leadership of Commissioner Billy Dulay and the landmark reforms we are putting in place in how we do taxation. I also expect you to intensify your efforts against tax evaders, and widen the taxpayer base,” he added.

Dominguez said improved revenue collections and tax administration have enabled the government to invest more in modernizing the nation’s logistics backbone, with public spending on infrastructure in 2018 rising to above 5 percent of the gross domestic product (GDP)–the highest it has ever been and double the average infrastructure spending as a percentage of GDP for the last 50 years.

He pointed out that infrastructure investments and expanded social programs are the drivers of economic growth, which is why despite slower global growth and other lingering external risks, the government expects the country’s internally driven GDP expansion this year to be between the 6.5 and 7.5 percent range.

Over the next two years, Dominguez said the Duterte administration plans on investing up to 7 percent of GDP in infrastructure modernization to allow the country to be at par with the more dynamic economies of the region.

“Much like in history, our government cannot do this alone. We all have a part to play. On the one hand, the government has to collect sufficient revenues for its projects. On the other hand, the taxpaying public has the important duty of ensuring that our country moves forward through their prompt and correct payment of taxes,” he said.

Dominguez said the rapid growth of the last three years, made possible by reliable revenue flows, brought down our poverty incidence from 23.3 percent in 2015 to just 16.6 percent in 2018.

A stronger economy, reduced poverty incidence, higher spending on infrastructure and social development, and better-quality government services that all aim to provide a better, decent, and comfortable life for all law-abiding Filipinos is what the Duterte administration meant in delivering on its promise of real change, Dominguez said.

“In three years, a total of 5.9 million Filipinos lifted themselves out of poverty. We are actually ahead of schedule in this regard. We are definitely on our way to over-performing on our self-imposed target of bringing down poverty incidence to 14 percent or lower by 2022 and eradicating extreme poverty in our country within one generation,” Dominguez said.

He said rapid economic expansion likewise brought down unemployment levels to historic lows, while the additional taxes collected enabled Government to fund free tertiary level education for the youth as well as its Universal Health Care (UHC) program.

Dominguez said international credit rating agencies attest to the Philippines’ strong fiscal discipline by upgrading the country’s credit ratings to BBB plus.

“This is the highest rating the country has ever achieved. Take note that we are not resting on our laurels. We are aspiring to gain an “A” level ratings before President Duterte ends his term,” he said.

Rapid economic growth in the last three years also brought the country to the threshold of an upper middle-income country, a feat that the Duterte administration is looking to achieve this year.

“All these are doable. The sustained strong performance of BIR will bring us there,” Dominguez said.

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