Philippine Government Sets Ambitious P6.12 Trillion Budget for 2025

The Philippine government has set an ambitious target for its 2025 national budget, proposing a total of P6.12 trillion, which is a notable increase from the P5.768 trillion allocated for 2024. This proposed budget for 2025 represents 20.5% of the nation’s gross domestic product (GDP).

The Development Budget Coordination Committee (DBCC) has outlined this budget plan as being consistent with the macroeconomic assumptions and fiscal targets for the country. This increase in budgetary allocation is seen as a move to support economic growth and align with the country’s broader economic goals as identified in the Medium-Term Fiscal Framework, the 8-Point Socioeconomic Agenda, and the Philippine Development Plan (PDP) 2023-2028.

The Philippine government’s fiscal performance has shown substantial improvement, with actual revenues rising to P3.22 trillion in the first ten months of the year, a 9.4% increase compared to the same period last year. This revenue exceeded the target for the period by 5.2%, driven by better-than-expected collections from the Bureau of Customs (BOC) and income from the Bureau of the Treasury (BTr), among others. The government anticipates that revenue will reach P3.847 trillion by the end of the year and is projected to further rise to P6.622 trillion in 2028 due to the anticipated implementation of priority tax measures. These measures are aimed at broadening the tax base, improving tax administration, and promoting environmental sustainability.

Moreover, government spending has accelerated, reaching P4.242 trillion by the end of October, a 4.5% increase from the previous year. This surge in spending is attributed to the agencies’ catch-up plans and accelerated implementation of various programs focused on infrastructure, social protection, education, livelihood, and employment. Disbursements for the year are projected to reach P5.340 trillion, a 3.5% increase from last year, with infrastructure spending also expected to accelerate to P1.424 trillion, equivalent to 5.8% of GDP.

Looking ahead, from 2024 to 2028, the government plans to maintain spending at an average of 20% of the GDP. Priority will be given to programs and projects that ensure social and economic transformation, aligning with the 8-Point Socioeconomic Agenda and the PDP 2023-2028. The government is also determined to keep infrastructure at the center of its growth strategy, setting annual public spending on infrastructure at 5% to 6% of GDP​​​​​​.