THE government expects to generate P170.9 billion in the next five years from the priority tax reforms of the Department of Finance (DOF), based on figures in the 2025 Mid-Year Report of the Development Budget Coordinating Council (DBCC).
The report estimates about P3.8 billion would be raised this year.
According to the DBCC document, the projected incremental revenues will come from the recently-enacted tax measures. These measures are: the value added tax (VAT) on digital service providers; the Create More law; the Capital Market Efficiency Promotion Act (Cmepa); and, the Enhanced Fiscal Regime for Large-Scale Metallic Mining.
With this, the revenue collections-to-GDP ratio is expected to see an increase from 15.9 percent this year to 16.8 percent after five years, read the report.
Among the measures, the VAT on Digital Services law, or Republic Act (RA) 12023, is anticipated to deliver the largest gains with P126.8 billion from 2025 until 2030.
Implemented last July, RA 12023 requires foreign and local platforms to register with the Bureau of Internal Revenue and remit VAT on transactions made within the country.
Meanwhile, the Create More Act (RA 12066) will cost the government about P13.08 billion from 2025 to 2030 due to the impact of the reduced corporate income tax to 25 percent from the previous 30 percent. The law also increased the additional deduction on power expenses from 50 percent to 100 percent to minimize costs for the manufacturing sector.
An additional 50-percent deduction for expenses on trade fairs and tourism reinvestments until 2034 will deduct P601.89 million from the revenue collection.
In an earlier report, the government expected about P5.9 billion losses from 2025 to 2028 due to the Create More; recent records show the same figure.
The DBCC report, nonetheless, expects the Cmepa (RA 2214) contributing P35 billion from 2025 until 2030 as taxes on capital markets are rationalized and excise tax is imposed on pickup trucks. This year, the government expects the revenue to reach P4.520 trillion and climb to P7.132 trillion in 2030.
Furthermore, the DBCC report noted that the Mining Fiscal Regime law (RA 12253), which will take effect only on January 1, 2026, would raise incremental value of P32.1 billion.
The government eyes an annual tax revenue growth of about 10.3 percent until 2030 that will be sustained by the overall impact of these tax measures, according to the report.
The DBCC added that ongoing digitalization initiatives will complement the reforms by improving compliance and collecting efficiency.