THE Bureau of Customs (BoC) is expected to forego P150 billion in revenue due to the smuggling of general merchandise and oil products this year, Finance Secretary Ralph G. Recto said on Tuesday.
“The estimate of the leakage (from Customs revenue) for the year will be roughly be P150 billion,” Mr. Recto said in a Senate Finance Committee budget hearing.
He was responding to a query from Sen. Francis Pancratius N. Pangilinan, who opened an investigation into the smuggling of agricultural goods.
“The last time we met with the new commissioner of the Bureau of Customs, they presented us with a catch-up plan,” he said, after the BoC missed its collection target last year after tariffs were lowered on key goods like rice.
Mr. Recto also outlined the Department of Finance’s (DoF) own plan to offset the BoC’s revenue foregone to smuggling.
The BoC earlier disposed of five containers of smuggled agricultural products valued at P35 million, which landed at the Port of Subic last month.
In 2024, the BoC seized P85.18 billion worth of smuggled products, including P1.19 billion in agricultural goods.
At the briefing, Mr. Recto said he is open to trimming the list of 130 items currently exempt from value-added tax (VAT) in lieu of imposing new taxes.
Asked by Senator Panfilo M. Lacson if he is open to reducing the VAT-exempt list, Mr. Recto said: “I’m one with you.”
“We will support if you can come up with additional revenue measures by reducing VAT exemptions,” he told reporters separately.
Mr. Recto said the VAT-exempt list currently includes agriculture, exports, small mom-and-pop stores, senior citizens, and persons with disabilities.
The government aims to trim the share of the deficit relative to gross domestic product to 3.1% by 2030.
The DoF remains committed to its no-new-taxes plan with the exception of the proposed Single-Use Plastic Act.
The 2026 Budget of Expenditures and Sources of Financing report indicates that the government aims to collect P4.52 trillion, rising to P4.98 trillion in 2026. — Aubrey Rose A. Inosante