DOF seeks lower P32-billion budget for 2027 despite lofty revenue goals

The BIR receives nearly two-thirds of the new appropriations, while Customs confidential fund gets slashed back to its 2024 level The Marcos administration proposes a P32-billion budget for the Department of Finance in 2027, with the Bureau of Internal Revenue receiving nearly 63% of the total. The proposed budget is 3.5% lower than the 2026 budget, with personnel services accounting for 52% of the spending, while the Bureau of Customs sees a significant reduction in confidential funds. The government anticipates a budget deficit of P1.69 trillion in 2027, with a projected decline in the deficit-to-GDP ratio over the next few years. This is AI-generated. Read the article for full context. Report any errors. MANILA, Philippines – The Marcos administration is proposing a P32-billion spending program for the Department of Finance (DOF) and its attached agencies in 2027, with the Bureau of Internal Revenue (BIR) receiving the biggest share at nearly 63%. Of the DOF’s total amount in the 2027 National Expenditure Program (NEP), P28.6 billion consists of new appropriations that Congress is being asked to approve. The remaining P3.4 billion will come from automatic appropriations, including special accounts. The proposed DOF budget is 3.5% lower than the P33.19 billion enacted for 2026, even as the proposed P7.2-trillion national budget has risen overall. It is also lower than the P37.8-billion spending program originally proposed for the DOF in the 2026 NEP. Personnel services account for P16.66 billion, or 52% of the full DOF spending program. Maintenance and other operating expenses receive P11.11 billion (35%), while capital outlays get P4.24 billion (13%). Another P25.12 million is set aside for financial expenses. The proposed total agency budgets, including funding sources outside new appropriations, are: BIR: P19.40 billion, up 6.9% from P18.15 billion in 2026 Bureau of Customs (BOC): P5.90 billion, down 9.7% from P6.53 billion Bureau of the Treasury (BTr): P4.05 billion, down 13.7% from P4.70 billion DOF Office of the Secretary: P1.15 billion, down 13% from P1.32 billion Insurance Commission: P656.69 million, down 44.7% from P1.19 billion Bureau of Local Government Finance (BLGF): P568.54 million, down 42.9% from P996.20 million National Tax Research Center: P148.37 million, down 3.6% from P153.95 million Privatization and Management Office: P134.80 million, almost unchanged from 2026 Central Board of Assessment Appeals: P24.74 million, up 34.9% from P18.34 million The Securities and Exchange Commission (SEC) has no regular line-item appropriation in the summary. Its charter and a special provision instead allow it to retain fees, fines, and other charges for operations and modernization, as well as P100 million from securities registration income. The BIR accounts for 62.8% of the full DOF proposed budget. The bureau’s biggest program is the enforcement of internal revenue laws, which receives P10.31 billion in new appropriations. Of this amount, P7.45 billion goes to personnel services, P2.84 billion covers operating expenses such as rent, utilities, security, travel, supplies, and professional services, and P11.98 million is allocated for capital outlays. It’s also spending P3.9 billion for revenue information systems and infrastructure support, which is 21% higher than its P3.2-billion funding level in 2026. The spending comes as the government asks the BIR to collect P3.736 trillion in 2027, 10.1% more than its revised target this year. Customs is expected to collect another P1.074 trillion. Together, they have the burden of generating more than 90% of the government’s P5.205-trillion revenue program. Customs confidential funds return to lower level For 2027, the administration is proposing P69.5 million in confidential funds for Customs, a 72% reduction from the P250 million enacted for 2026. Customs received P250 million in confidential funds under the 2026 General Appropriations Act, up from P69.5 million in the executive’s original proposal. The increase appears to have been placed under surveillance and prevention of smuggling. Funding for operating expenses under that activity rose by exactly the same amount, from P386.57 million in the 2026 NEP to P567.07 million in the enacted 2026 budget. Makabayan lawmakers questioned the broader increase in confidential and intelligence funds during the 2026 budget process, but the final budget retained the Customs increase. Customs later defended its use of confidential and intelligence funds after lawmakers questioned why illicit tobacco remained widespread despite the bureau’s enforcement resources. Bureau of Customs Commissioner Ariel Nepomuceno said the spending was well worth it, compared with the value of contraband seized by Customs. DOF’s outlook for the budget, deficit At the House development budget coordination committee briefing on August 17, Finance Secretary Frederick Go presented the government’s revenue and financing program and said the objective was “not to spend less, but to spend better.” The government expects the deficit to reach around P1.66 trillion, equivalent to 5.4% of gross domestic product, in 2026. The deficit is the difference between what the government collects and what it spends, while the deficit-to-GDP ratio measures the size of that borrowing requirement relative to the economy. The ratio is projected to decline further to 5.1% in 2027 and 3.5% by 2030. However, the deficit is still expected to rise slightly in peso terms to P1.69 trillion in 2027 as the government continues to spend more than it collects. The NEP remains an executive proposal that Congress may amend before passing the budget into law. – Rappler.com How does this make you feel? Loading