Meanwhile, Finance Secretary Margarito Teves said the government is not reducing its P125-billion deficit target for 2006 despite posting surpluses in the past months.
He gave the BIR and the Bureau of Customs targets of P675.4 billion and P197.6 billion, respectively, for the year. The target imposed for the BIR is 24.5 percent higher than the total collected last year, while the Customs target is 27.8 percent higher.
"Their targets are stressful," Teves conceded.
Buñag, however, said the BIR can achieve its target despite posting a total collection shortfall since January of half a billion pesos.
"We can meet the targets," Buñag said. "By hook or by crook, we will attain the targets."
Buñag, who was rumored to be on the way out due to the agency’s poor revenue collection, earlier complained the target imposed on the BIR was too high.
Customs Commissioner Napoleon Morales said it would be relatively easy for his agency to meet its target, since the agency is now 6.3 percent ahead in its collections.
These officials issued their statements following a command conference with President Arroyo at Malacañang, where she pressed the agencies to surpass their achievements in the last five months.
"I commend the hardworking men and women of our revenue agencies for your contribution to these causes," Mrs. Arroyo said during the meeting. "Much more is to be done and I trust that you are ready to bring the effort to a higher level."
"Growing the economy, fighting terror, getting rid of graft and corruption, all these goals will travel on parallel and related paths as we consolidate the nation," she said.
Teves said the total revenue target for the year, including those from non-tax collections like fees and other charges, is P975.6 billion — 19.5 percent higher than last year’s. This includes the P75 billion expected proceeds from the 12-percent expanded value-added tax (EVAT).
The BIR collections account for 70 percent of total revenues collected by government while the Customs bureau accounts for 20 percent.
The government’s plan to narrow the budget deficit to P125 billion, the smallest deficit in seven years, is "attainable," Teves said. Last year the government collected P795.7 billion, 12.7 percent more than its 2004 collection.
"If we continue with what we have been doing, I will be more comfortable we are ahead of our revenue program," Teves said.
The President hopes to erase the deficit by 2008 in order to boost the nation’s junk debt ratings, curb debt and reduce borrowing costs.
High interest ratings are capping spending on schools, roads and other infrastructure needed to boost growth in the Philippine economy.
National Treasurer Omar Cruz said on June 15 that the Philippines posted a budget surplus for a second consecutive month in May on higher tax collection. The surplus reached P5.8 billion in May and P17.6 billion in April.
Deficits since 1998 have piled up government debt, which has nearly tripled to P3.9 trillion in the last eight years and the Philippines is spending a third of its budget just to pay the interest on these obligations.
The government is also considering seeking agreements with people with unpaid tax bills to further boost revenue, Teves said.
"We will pursue this according to what is allowed by the law," he said. "We will look at it and see if it makes sense."
About P7 billion in outstanding taxes remain unpaid, Buñag said in a press statement.
Buñag also assured United States-based investment banks JP Morgan and Merrill-Lynch that the BIR stands solidly behind Teves’ bid to attain the collection targets set for the BIR and Customs.
"As far as the BIR is concerned, we are working for the revenue collection levels that have been previously set for 2006," he said.
"We will stay on track even as we plug loopholes and gaps in the revenue collection system and strengthen the mechanisms to ensure optimum collection levels," he added. "As of now, I see no reason for any modification of the country’s investment ratings." — With Bloomberg News