The Duterte administration has set its sights on getting an “A” rating in 2 years, and it intends to achieve this through the implementation of more reforms and infrastructure projects, Department of Finance (DOF) Secretary Carlos Dominguez III said on Monday.
“This administration can do two things at the same time: we can change, we can push big policy reforms and we can deliver infrastructure in the field,” he told reporters after the luncheon he hosted for former Finance Secretaries and senior DOF officials in celebration of the 122nd anniversary of the DOF.
Global debt watcher Standard & Poor’s last week upgraded the Philippine credit rating to “BBB plus” with a positive outlook, the highest sovereign rating the country has ever achieved, on the back of the strengths of the economy.
“While the achievements mentioned are certainly encouraging, we will not allow ourselves to become complacent. Even more work is needed to ensure that we reap the benefits of such accomplishments and continue to institute and implement meaningful reforms — not just to get that sterling “A” rating, but more importantly, to achieve a more comfortable life for all law-abiding Filipinos,” he said during the luncheon.
Dominguez said the credit rating upgrade recognized President Rodrigo Duterte’s commitment to bold reforms and sound economic policies.
He said it also signaled strong international confidence in the country’s fiscal management, putting the Philippines at par with countries like Mexico, Peru, and Thailand.
The finance chief cited the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) law, which resulted in a 108-percent achievement of the law’s revenue target and returned some P111 billion to the pockets of millions of individual taxpayers.
Dominguez considered the TRAIN law and the rice tarrification law as “game-changing reforms” along with other landmark initiatives the government has decisively undertaken such as increasing investments in infrastructure modernization, the introduction of a national ID system, and improvements in ease of doing business.
TRAIN is the first package of the comprehensive tax reform program (CTRP).
He said the DOF expects Congress to approve the legislation of the remaining components of the CTRP.
“The positive results of the TRAIN law provide the best arguments for completing the tax reform. We will again seek your wisdom and support to triumph over the political challenges,” Dominguez told his predecessors.
“The next phase of our tax reform is not focused on raising revenues, it is focused on fairness, it’s focused on getting a rational approach to our incentives. It’s not for additional revenue with the exception of the sin taxes,” he told reporters.
Dominguez said they intend to price sin products like cigarettes and alcohol beyond the reach of young people.
“We will continue with our fast and sure approach in securing concessional financing support for our ‘Build, Build, Build’ projects. We are confident, as more and more projects become shovel-ready, the immense multiplier effects of infrastructure investments will provide a strong stimulus to our economic expansion,” he added. (PNA)