2023 tax effort below Asia-Pacific average

The share of tax revenues to the Philippine economy has lingered below the regional average of efficient collections, highlighting the need to further improve tax administration and enforcement.

- By BEN ARNOLD DE VERA

The Organization for Economic Cooperation and Development's (OECD) Revenue Statistics in Asia and the Pacific 2025 report, published on July 8, showed that the Philippines' tax-to-gross domestic product (GDP) ratio in 2023 stood at 17.8 percent, down by 0.6 percentage point (ppt) from 18.4 percent in 2022.

The Philippines' 2023 ratio was also lower than the Asia-Pacific region's average of 19.5 percent.

The Philippine ratio was likewise only more than half of the 33.9-percent average of the richer nations belonging to the OECD.

But among its Southeast Asian neighbors, the Philippines exceeded Thailand's 17.1 percent, Vietnam's 16.8 percent, Singapore's 13.7 percent, Malaysia's 13.1 percent, Cambodia's 13 percent, Indonesia's 12 percent, Laos' 11 percent, and Timor-Leste's 9.6 percent.

"The highest share of tax revenues in the Philippines in 2023 was derived from value-added taxes/goods and services tax (23.2 percent)," the OECD noted, referring to the 12-percent VAT.