The Philippines has sufficient capacity to meet its public debt obligations despite national government debt reaching a record P19.39 trillion as of end-July 2026, Malacañang said.

Palace Press Officer and Presidential Communications Office Undersecretary Claire Castro said most government borrowings have long-term repayment schedules, allowing the state to gradually settle principal and interest.

She said current revenues remain sufficient to service the country’s debt while the administration continues to pursue tax reforms to strengthen government finances.

Castro cited the proposed Promoting Growth, Revenue, and Equity towards Socio-Economic Sustainability, or ProGRESS, measure as one component of the administration’s broader tax reform program.

The Department of Budget and Management said the ProGRESS Bill seeks to provide tax relief while strengthening government revenues to fund essential public services and long-term development programs.

Castro was responding to questions on whether the measure was necessary to address rising government debt.

“Hindi lang ito (the ProGRESS Bill). Ang lahat ng ginagawa ngayon na mga reporma sa tax ay maaaring makatulong at makapag-manage ng ating public debt,” Castro said.

The Bureau of the Treasury earlier reported that national government outstanding debt reached a record P19.39 trillion at the end of July 2026.

Castro stressed that the government does not need to pay most of its outstanding obligations immediately because the debt is structured over longer repayment periods.

She added that lowering income taxes for ordinary workers and small businesses could increase disposable income, stimulate consumption and generate additional revenues through stronger economic activity.

“When money circulates, there is additional movement in the economy that could result in higher revenue,” Castro said.

Apart from the ProGRESS Bill, the administration is considering proposals to increase excise taxes on distilled spirits and electronic cigarettes, impose taxes on vape devices and novel tobacco products, and raise taxes on plastic products and automobiles.

Castro said the measures form part of efforts to strengthen revenues and manage public debt.

She maintained that the country’s existing revenues are sufficient to meet debt obligations even without the proposed legislation.