Gov't's game plan: Maintain ‘fiscal stamina' vs COVID-19

In a virtual economic briefing to mark the 75th anniversary of the post-war bilateral relations between the Philippines and the United States, Finance Secretary Carlos Dominguez delivered his message right offthe bat: “This pandemic is a test of fiscal stamina and it was fortunate that when it hit us, the Philippines was financially ready.”

First, the tax reforms initiated by the Duterte administration when it assumed office in mid-2016 assured a steady revenue flow to cushion the severe impact of a Luzon-wide lockdown at the onset of the outbreak in March 2020. Second, “our record of fiscal discipline eased access to urgent financing as we battled the pandemic.” Despite the surge in the country’s debt to-GDP ratio from the historic low of 39.6 percent in 2019 to more than 54.5 percent last year, “we had ample fiscal space to absorb the huge financial shock” brought on by the double whammy of unbudgeted spending and decline in tax collection.