DOF expects dividends from GOCCs to hit P100 billion

MANILA, Philippines — The Department of Finance (DOF) is targeting to collect P100 billion in dividends from government-owned or -controlled corporations (GOCCs) by the end of the year, according to its top official.

During the 2024 GOCC Day in Pasay, Finance Secretary Ralph Recto said the government’s total dividend collections stood at P88.6 billion as of May 6, 11 times higher than P8 billion in the same period a year ago.

“We anticipate the total to reach P100 billion by yearend,” he said. “The GOCC’s generous contribution of P100 billion (will be) big enough to transform the lives of our people and secure their future.”

According to Recto, the P100-billion remittance could help build 1,600 kilometers of farm-to-market roads, construct 8,000 new public classrooms and irrigate an extra 25,000 hectares of farmland.

It would also help cancer patients with a month’s worth of free dialysis and chemotherapy treatments.

“On the part of the DOF, we assure you that all these contributions will be managed judiciously with utmost transparency and accountability,” he said.

“In turn, we expect all of our GOCCs to constantly strive for efficiency and the highest standards of corporate governance. We will not leave any room for incompetence and corruption,” he said.

The Dividends Law of 1994 mandates all GOCCs to declare and remit at least 50 percent of their annual earnings, as cash, stock or property dividends to the Bureau of the Treasury (Btr). Last year, GOCCs remitted P99.98 billion in dividends to the BTr.

As of May 6, a total of 47 GOCCs contributed to the P88.6-billion remittance. The Land Bank of the Philippines recorded the highest contribution with P32.11 billion, followed by the Philippine Deposit Insurance Corp. with P10.67 billion and the Bangko Sentral ng Pilipinas with P9.2 billion.

“They have not only remitted their expected contributions on time, but many of them have raised their dividend payments to 75 percent of their earnings from 50 percent to accelerate our growth,” Recto said.

GOCC dividends are sources of non-tax revenues that fund infrastructure and other social and economic programs of the government.

Based on the revised implementing rules and regulations of the law in 2016, the DOF may request GOCCs to remit above the 50 percent minimum dividend rate in the event that GOCCs have excess cash or windfall earnings.

This is provided that viability and purposes for which GOCCs have been established are not impaired.

“These dividends form a major source of non-tax revenues for the government, making possible our goal of raising more funds without the need to impose additional taxes on our people,” Recto said.

“They help us hold down deficits and continue funding the President’s priority programs for the welfare of all Filipinos without having to borrow more,” he said.