[Ask the Tax Whiz] P7.2-trillion budget: The Senate’s defining test

The House passed the proposed P7.2-trillion 2027 national budget on October 12. Now the Senate faces a defining test: scrutinize not only how much is allocated, but who inserted the projects, who benefits, and who ultimately gets paid. The Supreme Court has already sounded the alarm. Its landmark October 2026 ruling struck down unconstitutional congressional increases in previous budgets and invalidated specified conditions for releasing unprogrammed appropriations. The court did not prohibit all unprogrammed funds. It demanded constitutional safeguards, fiscal discipline, and transparent bicameral proceedings. That ruling should end the culture of questionable budget insertions without accountability. P1 trillion in red flags. Who will answer? The People’s Budget Coalition has flagged more than P1 trillion in potentially vulnerable allocations, including assistance programs, infrastructure projects, and unprogrammed funds. Among its findings: 405 projects worth approximately P4.37 billion under the Ilocos Norte First District Engineering Office, serving House Majority Leader Sandro Marcos’s district; and 91 projects worth roughly P1 billion under the Nueva Ecija First District Engineering Office, associated with House appropriations chair Mika Suansing’s district. The coalition reported that supporting documents for these additions were not publicly available in its review. These are red flags, not proof of criminal wrongdoing. Large allocations can be justified. But every project must withstand independent verification of its location, cost, engineering plans, beneficiaries, and procurement. A budget insertion must never become a blank check. More contracts for MSMEs. Fewer political family businesses. Government procurement should create opportunities for Filipino entrepreneurs—not become a source of privileged business for politically connected families. We propose reserving at least 20% of eligible government procurement opportunities for qualified Micro Small and Medium Enterprises or MSMEs, simplifying bidding requirements, breaking appropriate projects into smaller competitive contracts, and ensuring prompt payment. At the same time, Congress should enact stronger restrictions on government contracts involving politicians’ relatives, including the Senate-approved proposal covering relatives within the fourth civil degree. Require disclosure of ultimate beneficial owners and significant campaign donors. Disqualify firms from contracts involving actual conflicts of interest, prohibit political influence over procurement, and penalize the use of nominees to evade restrictions. Lawful political participation must remain protected. But campaign contributions must never become down payments for government contracts. Public spending should empower legitimate businesses, create jobs, and strengthen competition—not perpetuate political monopolies. Three reforms we cannot afford to delay First: Pass the CADENA Act. Make every peso traceable—from budget proposal, congressional insertion, and procurement to actual payment and project completion. Every material amendment should identify its proponent, justification, contractor, and ultimate beneficiaries. Digital transparency must enable independent verification, not merely publish paperwork after funds disappear. Second: Reform bank secrecy. Authorize lawful access to financial records for credible corruption investigations, with judicial safeguards, privacy protections, and due process. (READ: [Puso at Diwa] When AMLC’s financial intelligence speaks) Financial confidentiality must protect legitimate depositors—not conceal proceeds of corruption. Third: Audit unexplained wealth. Launch nationwide, risk-based investigations involving the Bureau of Internal Revenue, Commission on Audit (COA), Anti-Money Laundering Council, and Ombudsman. Cross-check public officials’ Statements of Assets Liabilities and Net Worth (SALNs), income tax returns, declared assets, campaign financing, and contractor relationships. Investigate credible discrepancies and recover unlawfully acquired wealth through due process. (READ: [Ask the Tax Whiz] How SALN, lifestyle checks, and citizen action can expose corruption) Congress must also lead by example. Article VI, Section 20 of the Constitution requires COA audits and annual itemized disclosures of amounts paid to and expenses incurred for every legislator. Personal certification must never become a blanket exemption from financial accountability. The Senate’s defining test The Senate must demand complete disclosure of questionable allocations, remove projects without sufficient justification, protect essential public services, and establish permanent safeguards against politically driven spending. Our national budget should finance functioning schools, better healthcare, modern transportation, resilient infrastructure, and opportunities for Filipino businesses—not political patronage. P7.2 trillion is not Congress’ money. It is the people’s money. Pass CADENA. Reform bank secrecy. Audit unexplained wealth. Prioritize MSMEs. End conflicts of interest in government contracting. Collect better before taxing more. Because taxpayers deserve more than promises of transparency. We deserve to know where every peso goes—and who profits from it. – Rappler.com Mon Abrea, CPA, MBA, MPA (Harvard) is a global tax policy expert and Chief Tax Advisor of Asian Consulting Group (ACGlobal). He advises governments, multinational enterprises, and international organizations on tax policy, investment competitiveness, and fiscal reform. He is the author of Reimagining the World Without Corruption and Why Invest in the Philippines? CREATE MORE Edition, and has represented the Philippines in policy dialogues at the OECD, World Bank, and other international forums.