BIR Revenue Collection

A 14.5 percent year-on-year drop in internal revenue collections was registered this quarter, with significant declines in the collection of income tax (-15.3%), value-added tax (-16.6%) and percentage tax (-12.4%). But with the second quarter a traditional seasonal peak season for tax collections, this quarter’s collection is 6.3 percent higher than the previous quarter amounting to Php753.645 million arising from improved collections in income and value-added taxes.

Income tax collections from Baguio City, the biggest contributor to regional income tax revenues, dropped 26.9 percent year-on-year still due to reduced collections from the transfer of Moog and Texas Instruments to “large taxpayer” category. Improved income tax collections in the other provinces was not enough to offset the drop in Baguio City’s collections. The lower collection in value-added taxes this quarter is attributed to lower consumption expenditures due to the continuing slow economic recovery.

The region continues to benefit from prevailing high prices of metallic minerals with excise tax collections from mineral products more than doubling from year-ago levels to Php1.921 million this quarter from just Php0.608 million last year.

Only Benguet and Ifugao realized improved year-on-year collections while improved quarter-on-quarter collections were recorded in Abra, Benguet and Mountain Province. Even as Baguio continues to account for more than half of regional revenue collections, its share has declined this quarter to 54.8 percent from 59.9 percent in the previous quarter.


The regional employment situation in the region slightly improved this quarter with the employment rate reaching 95.0 percent compared to 94.4 percent in the previous quarter and 94.0 percent in the same quarter last year. As such, the unemployment rate dipped to 5.0 percent from the 6.0 percent registered in the same quarter last year. This is also an improvement from the 5.6 percent unemployment rate in the previous quarter. Moreover, the underemployment rate was also down to 11.5 percent this quarter, significantly lower than the 18.9 percent last year and an improvement from the 14.9 percent level in the previous quarter.

Notwithstanding the drop in the unemployment rate, reports show that Lepanto Mining Corporation reportedly retrenched 455 workers due to company downsizing activities. In addition, McConnel Dowell, a subcontractor of SN Aboitiz Power (SNAP)-Benguet also reportedly retrenched 43 workers due to redundancy. Pines City Colleges and Baguio Central University also reduced manpower due to the low turnout of enrolees arising from the increasing cost of education.

Prices and Inflation

The overall increase in the prices of goods in the region further eased to 4.2 percent this quarter from the 4.8 percent in the previous quarter. This is also an improvement from the 4.9 percent recorded in the second quarter last year. This brings to 4.5 percent percent the average inflation for the first semester this year compared to the average 5.1 percent in the same period last year.

Even as the increase in the price of fuel continues to slow down compared to last year’s levels, fuel, light and water prices still increased by 9.8 percent this quarter This is however a big improvement from the 16.6 percent increase in the previous quarter and 16.3 percent increase in the same quarter last year. Fuel prices were still up 10.5 percent year-on-year due to continuing uncertainties in world oil supply while electricity prices were also up 13.6 percent from year-ago levels.

The continuing increase in the prices of food items is however becoming more pronounced. The year-on-year increase in food items inflation specifically show significant price pressures from items such as the food staple corn, fruits and vegetables, and fish products. From year-ago levels, the prices of fruits and vegetables, fish and corn are 11.0 percent, 7.8 percent and 4.5 percent higher. With sufficient rice supply, rice prices was only up 1.0 percent year-on-year.

Due to seasonal factors, prices for services was also 5.2 percent higher year-on-year. Educational services was 5.9 percent more expensive this quarter with the expected opening of classes in June. The Commission on Higher Education (CHED) reportedly approved in May increase in tuition, miscellaneous and other fees this school year in 12 CAR colleges. Out of the 39 public and private higher education institutions in CAR, 69 percent or 26 colleges will not increase fees this year. Prices for transport and communications services were also more expensive up by 6.0 percent year-on-year.