MANDATORY dividend remittances from state-owned firms have been raised amid efforts to increase government revenues, the Department of Finance (DoF) said on Monday.
In a statement detailing Finance Secretary Ralph Recto's accomplishments during his first 100 days in office, the DoF said that the dividend rate for government-owned and controlled corporations (GOCCs) had been adjusted to 75 percent from 50 percent.
The department did not state how this was accomplished. Under Republic Act (RA) 7656, which was approved in 1993, GOCCs should "declare and remit at least fifty 50 percent of their annual net earnings as cash, stock or property dividends to the national government."
Revisions to the implementing rules of RA 7656 that were issued in 2016, however, allows the DoF, in consultation with the Department of Budget and Management (DBM) and the Governance Commission for GOCCs (GCG), "may request the GOCC to remit above the 50 percent minimum dividend rate in the event that the GOCC has excess cash or windfall earnings; provided that the viability and purposes for which the GOCC has been established are not impaired."
DBM and GCG officials were not immediately available for comment.
Recto, who messaged reporters that the government was looking to raise revenues without having to impose new taxes, later said that there was no need to amend the law.
In 2020, then-Finance secretary Carlos Dominguez 3rd asked Congress to pass amendments to RA 7656, including raising the required dividends to at least 75 percent and also removing exemptions for some GOCCs.
The DoF's Privatization and Corporate Affairs Group earlier reported collecting P99.98 billion in GOCC dividends last year, up by 46 percent from 2022's P68.34 billion.
On Monday, the department said that collections as of April 24 of this year had reached P39.8 billion, nearly five times the P8.0 billion recorded in the same period last year.
Meanwhile, Recto also issued a department circular in February setting guidelines for the implementation of special provisions in this year's budget law.
"This circular will enable the DoF to mobilize substantial nontax revenues from GOCCs' unrestricted fund balances to unlock the Unprogrammed Appropriations of the 2024 GAA to fund the President's priority programs and projects," the department said.
Recto is also pushing for the privatization of more government assets and has ordered the Privatization Management Office to "recalibrate its list of assets for disposal to include those in mining, construction, as well as residential and commercial lots, among others."
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