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Department of Finance

Function of the DOF


The Department of Finance (DOF) is the governments steward of
sound fiscal policy. It formulates revenue policies that will ensure
funding of critical government programs that promote welfare among
our people and accelerate economic growth and stability
The Department envisions that the effective and efficient pursuit of the
critical tasks under its wings revenue generation, resource
mobilization, debt management and financial market development
shall provide the solid foundation for a Philippine economy that is one
of the most active and dynamic in the world
Mandate of the DOF
Formulation, institutionalization and administration of fiscal policies in
coordination with other concerned subdivisions, agencies and
instrumentalities of the government;
Generation and management of the financial resources of government;
Supervision of the revenue operations of all local government units;
Review, approval and management of all public sector debt, domestic
or foreign; and
Rationalization, privatization and public accountability of corporations
and assets owned, controlled or acquired by the government.
Cluster and Agency Under the DOF
As Mandated:

Assessment and collection of all national internal revenue


taxes, fees and charges.
Enforcement of all forfeitures, penalties, fines and execution of
judgments in all cases decided in its favor by the Court of Tax Appeals and
the ordinary courts
Administer supervisory and police powers conferred by National Internal
Revenue Code as amended by R.A. 8424 or other laws.
As mandated by Section 602 of the TCCP; Assess and collect
lawful revenues:
Prevent smuggling and other frauds
Control vessels/aircrafts doing foreign trade
Enforce tariff and customs laws
Control the handling of foreign mails for revenues and
prevention purposes
Control import and export cargoes
Jurisdiction over forfeiture and seizure cases
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As mandated by Section 602 of the TCCP; Assess and collect


lawful revenues:
Prevent smuggling and other frauds
Control vessels/aircrafts doing foreign trade
Enforce tariff and customs laws
Control the handling of foreign mails for revenues and prevention purposes
Control import and export cargoes
Jurisdiction over forfeiture and seizure cases
1. Assist in formulation of policies on borrowing, investment and
capital market development;
Formulate adequate operational guidelines for fiscal and
financial policies;
2. Assist in preparation by government agencies concerned of
an annual program, for revenue and expenditure targets, borrowing levels
and cash balances of National Government (NG);
3. Maintain books of accounts of the NG cash transactions;
4. Manage cash resources of NG, collect advances made, and guarantee and
forward cover fees due NG;
5. Control and service NG public debt, both foreign and domestic;
6. Issue, service, redeem government securities for account of NG as may be
authorized by the President pursuant to law.
Department of Finances (DOF) directly responsible over the
fiscal and financial affairs of local government. Under a
decentralized regime, BLGF provides a catalytic role in
effective and sustainable management of fiscal and financial
resources of LGUs, transforming them into self-reliant
communities. It is vigilant and dedicated to pursuit of
development and professionalization of its employees including those of the
local treasury and assessment services.
-Assist in formulation and implementation of policies on local
government revenue administration and fund management;
-Assist LGU in development and implementation of Real Property Tax
Administration (RPTA) projects

Department of Finances (DOF) directly responsible over the


fiscal and financial affairs of local government. Under a
decentralized regime, BLGF provides a catalytic role in
effective and sustainable management of fiscal and financial
resources of LGUs, transforming them into self-reliant
communities. It is vigilant and dedicated to pursuit of
development and professionalization of its employees including those of the
local treasury and assessment services.
-Assist in formulation and implementation of policies on local
government revenue administration and fund management;

-Assist LGU in development and implementation of Real Property Tax


Administration (RPTA) projects

Department of Finances (DOF) directly responsible over the


fiscal and financial affairs of local government. Under a
decentralized regime, BLGF provides a catalytic role in
effective and sustainable management of fiscal and financial
resources of LGUs, transforming them into self-reliant
communities. It is vigilant and dedicated to pursuit of
development and professionalization of its employees including those of the
local treasury and assessment services.
-Assist in formulation and implementation of policies on local
government revenue administration and fund management;
-Assist LGU in development and implementation of Real Property Tax
Administration (RPTA) projects

As Mandated:
Promote the viability and growth of cooperatives as
instruments of equity, social justice and economic
development in fulfillment of the mandate in section 15,
Article XII of the Constitution.
Mandate:

To

To promote growth and financial stability of insurance


companies.
To professionalize insurance services and develop insurance
consciousness among the general populace
To establish a sound national insurance market, and
safeguard the rights and interest of the insuring people.

Mandate:
To promote a tax system that will ensure a fair distribution of
the tax burden among the Filipino taxpayers. To recommend
necessary improvements in the tax system by conducting
continuing quality research on taxation. To provide responsive
staff support to fiscal policy makers. To provide opportunities for professional
growth and promote the well-being of our personnel.
Mandate:
To warrant observance of the due process of law clause
mandated by the Constitution in the assessment and
collection of real property taxes by the government,
To ensure that the taxpayers are given the opportunity to be
heard

INSURER, provides adequate depositor protection and education


and ensure immediate processing and settlement of depositor claims;
As REGULATOR, conducts diligent monitoring and examination of
member banks and implement prompt, decisive and prudent
interventions; As RECEIVER, implements efficient receivership,
judicious rehabilitation, and expeditious liquidation of closed banks.

To stimulate, increase and develop the export of goods and


services, and to facilitate investment in strategic sectors for the
countrys development by extending guarantees, insurance,
credit and related technical assistance services to viable
enterprises

Privatization and Management Office

The Philippine Government is committed to a free market


economy. There is, however, significant direct government
involvement in the countrys economic activity through both
economic planning and the state-ownership of numerous
corporations involved in certain strategic sectors, such as banking, powergeneration, oil production and transportation.

Application for LGU Loan


Under the Local Government Code (LGC), local governments may
contract loans, credits, and other forms of indebtedness to finance the
construction, installation, improvement, expansion, operation, or
maintenance of public facilities, infrastructure, housing projects, the
acquisition of real property, and the implementation of other capital
investment projects, subject to terms and conditions as may be agreed upon
by the LGU and the lender. The proceeds from such transactions accrue
directly to the LGU. However, an LGU can only incur expenditures for debt
servicing up to 20% of its annual regular income.
Every loan application must comply with the requirements of the DOF, the
Bureau of Local Government Finance (BLGF), and the Bangko Sentral ng
Pilipinas (BSP).
A. CERTIFICATION BY THE BLGF OF AN LGUS (I) NET DEBT
SERVICE AND (II) BORROWING CAPACITY CEILINGS, PER DOF
LOCAL FINANCE CIRCULAR NO. 1-2012

Letter-request from the Local Chief Executive (LCE) indicating the


selected lending institution, terms and conditions of the proposed loan
(repayment period and interest rate), and the specific purposes of the
proposed loan.
Approved and Uploaded Statement of Receipts and Expenditures for
the past 3 years
Certification of absence of loan/s, when applicable
Certification of existing and approved loans, when applicable

COA Annual Audit Certificate for the past 3 years with no adverse
findings against the LGU (supported by Pre-Closing Trial Balance,
Balance Sheet, and Statement of Income and Expenditures)
Certification by the local accountant that the LGU has not incurred
default in the payment of existing loan amortization
Certification from the secretary of the Sanggunian that the proposed
project to be financed by the loan is included in the Approved Annual
Investment Plan for the current year
Authenticated copy of the Ordinance/Resolution authorizing the LCE to
negotiate and contract a loan in behalf of the LGU
For loan applications related to foreign-assisted projects: Certified
Statement of Income (DBM LBP Form No. 1) and Statement of Fund
Operation (DBM LBP Form No. 8)
Certification issued by the lending institution that it shall not be
requiring LGU deposits as compensating balance for the loan if such
lending institution is (i) not an authorized government depository bank
or (ii) an authorized government depository bank required to obtain the
prior approval of the DOF per Department Order No. 27-05
DILG Seal of Good Housekeeping award to the LGU (Seal of Good
Financial Housekeeping)
Proof of Compliance with the DILG Full Disclosure Policy, per DILG MC
No. 2010-83

B. REQUESTING FOR THE BSP MONETARY BOARD (MB) OPINION (TO


BE SUBMITTED BY THE LGU OR BY THE LENDING BANK ON BEHALF
OF THE LGUS TO BSP), PER BSP CIRCULAR NO. 769 S. 2012:

Letter by the LGU, or the lending bank on behalf of its client LGUs,
requesting for the MB opinion on the proposed loan, and providing
information on the terms and conditions of the proposed loan (i.e., loan
amount, purpose of loan [whether for infrastructureor importation of
equipment, etc.], interest rate, maturity, fees and other charges).

Certification on the debt service and borrowing capacity of the LGU


obtained from the Department of Finance Bureau of Local
Government Finance (DOF-BLGF)

Designation of a contact person/s responsible for coordinating with the


BSP along with contact information, and a Sanggunian Resolution on
the specific acts/services he/she has been authorized to perform.

Indication of the lending bank on the source of the funds to be lent to


the LGU

C. RELEASE OF LOAN PROCEEDS (TO BE SUBMITTED BY LGU TO


THE LENDING INSTITUTION)

Upon approval of the loan agreement: Ordinance ratifying the loan


agreement, including the terms and conditions of the loan, entered into
by and between the local government unit and the lending institution

Other applicable requirements under the LGC, such as the provincial


validation of the municipality/city ordinance, if applicable, or
municipal/city validation of barangay ordinance.

A waiver on the confidentiality of investment and bank deposits,


whether in peso or foreign currency. Such waiver should be duly
executed by the mayor or governor or barangay chairman as the case
may be, and supported by a duly-executed waiver resolution.

D. REQUEST FOR MB OPINION ON LGU BORROWINGS TO BE


OBTAINED FROM OTHER FINANCIAL INSTITUTIONS NOT UNDER
THE SUPERVISION OF THE BSP
All documentary requirements and information under B and C shall
be submitted to the BSP by the borrowing LGU, together with its
request for MB opinion, in case the loan will be obtained from other
lending institutions not under the supervision of the BSP
E. POST-BORROWING REPORTS
The borrowing LGU, or its duly authorized representative or through the
lending bank, shall submit to the BSP a post-borrowing report that will
indicate the actual amount of the domestic borrowing as well as the final
terms and conditions thereof within 30 calendar days from the full release
of loan proceeds and other reports as may be required by the BSP.In
addition, the local treasurer is required by the BLGF to submit a postborrowing report

OFFICE OF THE SECRETARY


The authority and responsibility for the exercise of the mandate of the
Department and for the discharge of its power and functions shall be vested
in the Secretary of Finance, who shall have supervision and control of the
Department and shall be appointed by the President.
CORPORATE AFFAIRS GROUP
The DFG is primarily responsible for forecasting and programming revenues
of the national government (NG); cash programming and monitoring of NG
finances; undertaking studies on capital market development, debt
management, resource mobilization, fiscal reforms, etc.
DOMESTIC FINANCE GROUP AND LEGISLATIVE LIAISON
The DFG is primarily responsible for forecasting and programming revenues
of the national government (NG); cash programming and monitoring of NG
finances; undertaking studies on capital market development, debt
management, resource mobilization, fiscal reforms, etc.
Fiscal Policy And Planning Office
Formulates long-range and annual projections of revenue needs, cash
position and borrowing capacity of the Government as basis for policy
decisions of the Department; Supervise policy research and development on
fiscal and tax measures undertaken by the operating bureaus and offices of
the Department; Coordinate with other government agencies on policy
research as it impacts on fiscal and tax measures.
Assists in the overall macroeconomic planning process in coordination with
the DBCC by providing inputs to the National Governments Annual and
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Medium-Term Fiscal Program


Prepares/Forecasts/assesses the revenue program/projections
Consolidates the Public Sector Financial Position and Public Sector Debt
from reports provided by the Corporate Affairs Group, Bureau of the Treasury,
GFIs and BSP.
Prepares studies on Excise taxation, VAT and Tariffs formulates/drafts tax
reform measures/bills; prepares position papers; provides technical
assistance to Congress; reviews implementing rules and regulations
Collects, monitors, reviews, consolidates and analyzes economic reports
and data required for fiscal planning and policy formulation activities

a)

b)

c)

d)

Research And Information Office


The research and Information Office (RIO) is primarily responsible for tax
policy formulation, legislative liaison work on tax, financial and economic
proposals, and information dissemination activity. Specifically, these involve
the
Conduct of studies and simulations, and preparations of DOF position
papers/comments on various tax and fiscal-related bills, or on the tax
aspects of other bills initiated by other agencies or legislators;
The research and Information Office (RIO) is primarily responsible for tax
policy formulation, legislative liaison work on tax, financial and economic
proposals, and information dissemination activity. Specifically, these involve
the
a) Conduct of studies and simulations, and preparations of DOF position
papers/comments on various tax and fiscal-related bills, or on the tax
aspects of other bills initiated by other agencies or legislators;
b) Drafting of tax reform bills and the submission and shepherding of the
same in both Houses of Congress;
c) Extending technical assistance to both Houses of Congress and individual
legislators in the drafting and analysis of tax bills;

e)
d) Participation in the preparation or review of implementing rules and
regulations of various tax laws or laws with tax provisions; and
f) e) Conduct of briefings/lectures on the mandate, functions, activities and
accomplishments of the DOF to visiting students from various colleges and
universities, as well as other government functionaries.
REVENUE INTEGRITY PROTECTION SERVICE
RIPS investigates allegations of corruption in the Department of Finance and
its attached agencies such as the Bureau of Internal Revenue and the Bureau
of Customs, the Bureau of Local Government Finance, Bureau of Treasury,
Central Board of Assessment Appeals, the Insurance Commission, the
National Tax Research Center, the Fiscal Incentives Review Board, and the
Privatization and Management Office.
RIPS then files the necessary charges against erring officials and employees
with the proper government agencies (e.g., Office of the Ombudsman).
RIPS encourages active citizens participation in eradicating corruption in
Government.
INTERNATIONAL FINANCE GROUP
The IFG secures foreign grants and loans; initiates and negotiates foreign
borrowing and debt restructuring; participates in policy formulation regarding
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external resource mobilization; coordinates with other government agencies


regarding international agreement on trade, investment, tax treaties and
other international arrangements.
IFOO provides advisory and technical support services in the formulation,
evaluation and execution of Philippine negotiating positions and options with
respect to the restructuring of external debt, as well as new loans and
grants, from bilateral and multilateral financial institutions.
IFPO provides advisory and technical supports services with respect to
international economic, financial and trade developments and their
implications for the Philippine economy. IFPO also provides inputs into the
formulation of fiscal, monetary, financial, foreign trade, budgetary, balance
of payments and exchange rate policies.

POLICY DEVELOPMENT AND MANAGEMENT SERVICES GROUP


The PDMSG provides administrative and financial management support to
the Groups in DOF OSEC; designs and manages the human resource
development program of the Department; coordinates activities of the
bureaus, agencies and corporations under the DOF and with other
institutions on matter of national importance and in ensuring that directives
and collaborative undertakings for executive offices on common concerns
are promptly considered; and attends to public relations and related
concerns.
Central Administration Office
The CAO supervises services relating to personnel human resource
development and general service administration, property and supplies
procurement and custody, and maintenance of central files, and
corresponding reporting system.
The CFMO supervises activities relating to budget preparation and
management, accounting and internal audit.
Central Management Information Office IT
The CMIO-IT monitors and evaluates programs and projects, including those
that are executed by operating Bureaus and Offices; Formulates policies,
plans and procedures for data control and systems management; act as the
central repository of existing and future computer files.
PRIVATIZATION AND OFFICE OF SPECIAL CONCERNS
The Privatization Council (PrC) is a cabinet-level and inter-agency policy
making body tasked to oversee the Philippine Privatization Program. It
formulates privatization guidelines, approves privatization transactions as to
price and buyer, designates disposition entities and monitors postprivatization activities.
Privatization Office
The Privatization Office provides technical and administrative assistance to
the Secretary of Finance in the exercise of his function as Chairman of the
Committee on Privatization. It evaluates and reviews issues involved in the
prospective privatization or disposal of government corporation assets,
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monitors the implementation of dispositive actions for transferred assets and


GOCCs approved by the President including the introduction of necessary legislation
thereon, and assesses the aggregative and sectoral financial and socio-economic
impact of the privatization or disposal of specific transferred or corporate assets in
coordination with other appropriate and concerned entities.

REVENUE OPERATIONS GROUP


The Revenue Office is responsible for processing of applications for
exemption from payment of duties or taxes on importations of qualified
applicants and chartered entities; Reviews discussions of the BOC in seizure,
forfeiture, dumping, auction, abatement and refunds, protest and other tariff
and customs related cases.
Revenue Office
The Revenue Office is responsible for processing of applications for
exemption from payment of duties or taxes on importations of qualified
applicants and chartered entities; Reviews discussions of the BOC in seizure,
forfeiture, dumping, auction, abatement and refunds, protest and other tariff
and customs related cases.
Mabuhay Lane
On May 13, 1994, the DOF issued Department Order No. 29-94 creating the
OPLAN: The Mabuhay Lane, which is tasked to expeditiously process
applications for tax and duty exemption of six (6) sectors of importers,
namely: Export-Oriented firms (BOI), etc.; Returning residents; Non-Profit,
Non-stock educational institutions; Books and Periodicals; DOE Contractor,
etc.; 105(r) Livestocks.
One-stop-shop Tax Credit And Duty Drawback Center
The CENTER was established as the governments response to the mounting
complaints being aired by the private sector over the countries highly
chaotic and inefficient tax credit and duty drawback system. The CENTER
was formed primarily to serve as one of the governments pillars in its export
promotion and investment generation drive by making the various tax credit
and duty drawback incentive programs readily accessible to legitimate
exporters.
Legal Affairs Office
Provides legal services and opinions to and conducts legal research on the
domestic and international aspect of taxes, customs, and tariff, as
appropriate within the Department as well as bureaus and offices under it.

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