Philippine Government Releases Funds From VAT Windfall

by Mary Swire, Tax-News.com, Hong Kong

15 December 2008

The Philippine government has decided to release PHP7.3bn (USD153m) worth of revenue back into the economy following windfall value-added tax (VAT) revenues this year, it has been announced.

The decision was made in a bid to try to protect the economy's low-earners from the effects of increasing fuel and food prices, and was made effective under President Arroyo's "Katas ng VAT" regime, on November 14.

According to the country's Finance Undersecretary, Gil S. Beltran, under the programme:

• PHP4bn was injected into the country's Department of Social Welfare and Development to assist with the PHP500 per month rewards they are giving to households that are consuming lower levels of energy;
• PHP500m was given to the Energy Department for the upkeep of the Philippine Energy Efficiency Program;
• A further PHP500m was also awarded to the country's Education Department in acknowledgement of its supplemental feeding program;
• PHP231m has been given to the Department of Health to help with the continued upgrade of the country's hospitals; and
• The Presidential Commission for the Urban Poor received PHP231m to ensure it is able to continue financing individuals facing the prospect of becoming homeless.

However, Beltran went on to explain that this fund release was likely to be the last under Arroyo's Katas scheme for some time.

Please enter your email address to join the Tax-News.com mailing list. View previous newsletters.

To manage your mailing list preferences, please click here »