THE Bureau of Customs (BoC) is seeing 50% year-on-year drop in trade volume in the first half of February, as the coronavirus disease 2019 (COVID-19) outbreak disrupted global supply chains.
“I just got the figures, the first 15 days of February, as compared to the first 15 days of February last year, is a little over a half only of the TEUs (twenty-foot equivalent units), containers coming in. We’re concerned but we believe that the slack will be taken up in other markets,” Finance Secretary Carlos G. Dominguez III told reporters on the sidelines of an event in Pasay City on Tuesday.
Sought for comment, BoC Assistant Commissioner and Spokesperson Vincent Philip C. Maronilla told BusinessWorld that the 50% decrease in volume is considered “huge” for the agency’s collections, as it saw declines in cargo from China, the center of the COVID-19 outbreak.
“Marami rin nanggaling from other countries (other countries also reported declines) but because China is our biggest trading partner, a big chunk of the volume decline was goods coming from China,” Mr. Maronilla said via mobile phone on Tuesday.
He said the decline was first observed in February, as the outbreak continued to spread from mainland China to other countries.
“We’ll have to see with how global economy would react and bounce back because we need to recognize this thing (outbreak) has affected the entire global economy already,” Mr. Maronilla said, who declined to disclose specific figures.
However, the Finance chief remained confident the government will hit its revenue collection target this year, despite worries over how the COVID-19 outbreak may impact the economy.
“We’re going to make our target. The Bureau of Internal Revenue (BIR) has all the tools, manpower and systems to collect that amount,” Mr. Dominguez said.
The BIR is tasked to collect P2.576 trillion this year, accounting for 78% of the P3.3-trillion goal for the country’s two biggest tax collection agencies. The Customs bureau is tasked to collect the remaining P731.235 billion.
BIR Deputy Commissioner for Operations Arnel S.D. Guballa earlier said that some businesses already reported a decline in sales due to the Taal Volcano eruption and the outbreak, which may yield lower tax collections in the first quarter.
Mr. Dominguez said he expects the drop in business revenues, which may lead to lower tax collections, will be “temporary until this coronavirus contagion is [contained].”
Collections of the BIR and Customs make up the bulk of the country’s revenues, with other collections coming from the Bureau of the Treasury and nontax revenue from other offices, such as privatization proceeds and fees.
These revenues are meant to fund the government’s P4.1-trillion spending program this year, with other funding to come from local or foreign borrowings, as the country still operates on a budget deficit. — Beatrice M. Laforga