The proposed measure increasing taxes on capital gains, donor’s, and estate to 10% from 6% has been withdrawn as the Department of Finance (DOF) determined that there would be “no need” for additional revenue measures, citing the government’s robust fiscal position.
In a statement, Albay 2nd District Representative and House Ways and Means chairman Joey Sarte Salceda disclosed that the DOF pulled out the Government Revenues Optimization through the Wealth Tax Harmonization (GROWTH) Bill, which proposed a hike in tax rate for capital gains, donor taxes, and estate taxes.
The bill is the Marcos administration’s tweaked version of the Passive Income and Financial Intermediary Taxation Act (PIFITA), proposed by the Duterte administration as Package 4 of its Comprehensive Tax Reform Program (CTRP).
Citing a letter from the DOF, dated April 29, Salceda said the Finance Department is withdrawing the proposed measure, citing “stronger-than-expected revenue collections, a double-digit growth rate in tax collections, and steady progress toward the government’s fiscal consolidation goals.”
In a separate statement, Finance Secretary Ralph Recto said that “given our current strong fiscal performance, these are not needed at this time.”
“The government is properly managing its finances, ensuring that public needs are met without burdening the citizenry with new taxes,” he added.
‘More than sufficient’
In particular, the Finance chief cited the 13.55% growth in total tax collections to P931.5 billion in the first quarter of 2025.
Broken down, the Bureau of Internal Revenue (BIR) posted P690.4 billion in collections, up 16.67% year-on-year; while the Bureau of Customs saw a 5.72% growth in collection to P231.4 billion during the same period.
“At this point, current revenues are more than sufficient to support our expenditure requirements. We are meeting our obligations, funding key programs, and growing the economy without having to impose new taxes on our kababayan,” Recto said.
“We are also decisively managing our deficit level, while maintaining a sustainable debt trajectory aligned with our Medium-Term Fiscal Framework (MTFF),” the Finance chief added.
The DOF, Recto said, is committed to ensuring the successful implementation of critical measures that would retain and attract more investments as well as generate more revenues for the government, such as the CREATE MORE Act; the Ease of Paying Taxes (EOPT) Act; the amendments to the Foreign Investment Act, the Retail Trade Liberalization Act, and the Public Service Act; and the Public-Private Partnership (PPP) Code, among other measures.
At the same time, the DOF will continue to explore and strengthen non-tax revenue sources to meet the revenue targets set out in the Budget of Expenditures and Sources of Financing (BESF).
Salceda, for his part, expressed his full support for the DOF’s broader fiscal consolidation agenda.
“Secretary Recto’s leadership ensures that fiscal prudence and economic dynamism will go hand in hand. The right tax, at the right time, for the right reason. That’s the way forward,” the lawmaker said.
Recto, meanwhile, said that “strategic measures were prepared to ensure fiscal sustainability and provide necessary buffers amid rising global economic uncertainty due to political tensions, prolonged higher interest rates, and unpredictable trade policies.” —VAL, GMA Integrated News
