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The Department of Public Works and Highways (DPWH) has suspended the bidding of all locally funded projects for two weeks, in line with the government’s ongoing investigation into alleged irregularities in flood control projects.

“I will order today a pause to all ongoing bidding of all locally funded projects nationwide,” Public Works and Highways Secretary Vivencio “Vince” B. Dizon said at a press briefing on Wednesday.

The suspension of ongoing bidding processes will apply to all national, regional and district offices, and will only be in effect for a maximum of two weeks, Mr. Dizon said, adding this will help the agency develop and implement safeguards against so-called “ghost” projects.

He said all foreign-funded projects will continue because he is confident that foreign funding agencies are closely monitoring project implementation.

The agency’s decision is also in line with President Ferdinand R. Marcos, Jr.’s State of the Nation Address on July 28, directing the DPWH to submit a full list of projects from the past three years and ordering an investigation into flood control projects.

The department has submitted a list of over 9,000 projects completed between July 2022 and May 2025. Of these, 160 projects have undergone validation, with 15 reported as missing or unlocated, according to former DPWH Secretary Manuel M. Bonoan.

Nigel Paul C. Villarete, a senior adviser on public-private partnerships at the technical advisory group Libra Konsult, Inc., said the suspension is a welcome development especially if the aim is to prevent any more irregularities.

He said it would be better if the government just paused the awarding of these projects.

“We can already incorporate necessary checks and balances considering the lessons learned without necessarily placing setbacks on our overall infrastructure development program. Once the probe is completed, then, these may be awarded, or not, in consideration with the findings of the probe,” Mr. Villarete said.

“What can be done is to allow the continuation of these existing bidding under a heightened transparency monitoring, considering the lessons learned, but up until pre-final award only,” he added.

Rene S. Santiago, former president of the Transportation Science Society of the Philippines, said it would be best to cancel the bidding for any flood control projects under the General Appropriations Act of 2025.

On Tuesday, DPWH’s Mr. Dizon said he will need between 30 and 60 days to reorganize the agency, after seeking courtesy resignations from all DPWH officials to facilitate an investigation into corruption in big-ticket flood control projects.

Mr. Marcos said previously that about PHP 100 billion of the total PHP 545 billion in government funds that were allocated for flood control projects nationwide since 2022 were cornered by just 15 contractors.

Among the top 15 flood-control contractors earlier identified by Mr. Marcos were Alpha & Omega Gen. Contractor & Development Corp. and St. Timothy Construction, both reportedly linked to former Pasig mayoral candidate Cezarah Rowena C. Discaya.

Licenses revoked

Meanwhile, Philippine Contractors Accreditation Board (PCAB) has issued a resolution on Sept. 1, revoking the licenses of nine construction companies owned by Ms. Discaya that were tagged in ghost projects.

“The decision comes after Ms. Discaya’s sworn testimony during the Senate Blue Ribbon Committee Hearing on Sept. 1, 2025, where she admitted ownership and control of the nine firms and their participation in government project bidding,” PCAB said.

Trade Secretary Ma. Cristina A. Roque, who is also the chairperson of the Construction Industry Association of the Philippines (CIAP), placed CIAP and its implementing boards and PCAB under her supervision.

Directly supervising CIAP and PCAB will ensure order and transparency within the agencies, Ms. Roque said.

The other contractors that were identified behind ghost projects are Legacy Construction Corp.; EGB Construction Corp.; Topnotch Catalyst Builders, Inc.; Centerways Construction and Development, Inc.; Sunwest, Inc.; Hi-Tone Construction & Development Corp.; Triple 8 Construction & Supply, Inc.; Royal Crown Monarch Construction & Supplies Corp.; Wawao Builders; MG Samidan Construction; L.R. Tiqui Builders, Inc.; and Road Edge Trading & Development Services.

With this, the DPWH had requested the Department of Justice (DoJ), and the Bureau of Immigration for a lookout order against the officials of the contractors and executives of DPWH.

Mr. Dizon said among the individuals they had requested to be included in an immigration lookout bulletin order are Henry C. Alcantara, former DPWH Bulacan First District Engineer; Brice Ericson D. Hernandez, officer-in-charge, office of the Assistant District Engineer in Bulacan; Ms. Discaya and Pacifico F. Discaya of Alpha & Omega; Edgar S. Acosta, president of Hi-Tone Construction and Development; and Mark Allan V. Arevalo, general manager of Wawao Builders.

Review of DPWH budget

Meanwhile, the President has directed Mr. Dizon and Budget Secretary Amenah F. Pangandaman to conduct a “sweeping review” and “make the necessary corrections” in the proposed 2026 budget of the DPWH, Palace Press Officer Clarissa A. Castro said at a press briefing.

“The President emphasized that the review must lead to necessary changes to guarantee transparency, accountability, and the proper use of the people’s money,” Ms. Castro told reporters in Malacañang.

Ms. Castro said any insertions or duplications in the DPWH’s proposed budget should be immediately corrected to ensure budget deliberations stay on track.

“The President does not want this review to drag on. It must be fast and thorough,” Ms. Castro said.

The review could lead to the reduction of the DPWH’s proposed budget if projects are found to be duplicates or already completed, she said.

In a press conference late on Wednesday, Mr. Dizon said the DPWH budget review will take around two weeks. — Ashley Erika O. Jose, Reporter with Erika Mae P. Sinaking

The Department of Finance (DoF) wants the 20^th Congress to prioritize several tax measures to help support the government’s fiscal consolidation effort, a Finance official said on Wednesday.

The government is considering a domestic top-up tax for multinational companies in the Philippines and an excise tax on single-use plastics, alongside general tax and estate tax amnesties, Finance Undersecretary Karlo Fermin S. Adriano said.

These measures could help bolster efforts to cut down government debt and sustain economic growth via state spending amid global uncertainties, shifting trade relations and geopolitical conflicts, he added.

“Right now, our debt-to-GDP (gross domestic product) ratio is still around 61-62%, and we want to have a fiscal buffer if there will be a crisis,” Mr. Adriano told lawmakers at a hearing at the House of Representatives. “We want to do fiscal consolidation at the moment, and at the same time we want to spend more at the moment given global uncertainties.”

The government is hard-pressed to tap new revenue streams as mounting public debt adds strain to already limited fiscal space.

As of end June, the debt-to-GDP ratio rose to 63.1%, its highest level since 2005. The figure remains above the 60% threshold that multilateral lenders view as manageable for developing economies.

The DoF is pushing for an excise tax on single-use plastics as a way to reduce the use of plastic as the Philippines is among the top contributors of plastic pollution in waterbodies globally, said Mr. Adriano.

The proposal was one of the 28 priority bills identified by the Legislative-Executive Development Advisory Council in the 19^th Congress. While it was approved by the House on third reading in 2022, the measure never made it out of the Senate Ways and Means Committee.

The DoF is looking at levying a PHP 150-per-kilogram tax on single-use plastics with an annual 4% increase, Mr. Adriano said.

“Previously, it only covered single-use plastic bags, like semi-transparent plastics and sando bags. Now, we’re considering to expand the coverage,” he said.

Implementing an excise tax on single-use plastics could net the government an average of PHP 11.59 billion in revenue annually over the first five years of implementation, said Mr. Adriano, with a portion of the collections being used to fund waste management programs.

Global minimum tax

The DoF official said they are also looking at pushing for a 15% domestic top-up tax for multinationals with a global revenue exceeding 750 million euros in two of the four preceding fiscal years.

The Philippines is a party to the Base Erosion and Profit Shifting program by the Organisation for Economic Co-operation and Development, a global initiative that seeks to crack down on tax avoidance by multinational companies. Signed by more than 100 nations, it included a proposal to introduce a 15% global minimum tax (GMT) rate.

Mr. Adriano said the absence of a GMT framework has cost the Philippines an estimated P162.9 billion in annual revenues since it was globally implemented in 2021.

“If we do not have a legislated domestic top-up tax here… we will not be able to collect it. But if another jurisdiction has that domestic top-up tax, they (multinationals) will pay it in another jurisdiction,” he said.

Most multinationals operating in the Philippines are Japanese companies, followed by those from the US, UK, Germany and France, according to a DoF presentation to lawmakers.

The tax proposals are a “step in the right direction” but are ill-timed due to challenges in economic growth and inflation risks, said Jonathan L. Ravelas, a senior adviser at Reyes Tacandong & Co.

“The excise tax on single-use plastics and the domestic top-up tax align with global standards and can boost revenue while promoting sustainability. But effectiveness hinges on swift implementation and strong enforcement,” he said in a Viber message.

Tax amnesty

The Finance department is also proposing a general tax amnesty for outstanding income, withholding, capital gains, and other percentage taxes, with rates set at 2% of a taxpayer’s total assets as of December 2024 or 5% of total net worth, whichever is higher.

Lawmakers in the House and Senate are pushing for a general tax amnesty that will impose a 2% amnesty tax rate dependent on the total assets of taxpayers up to 2024.

Corporate rates would be based on subscribed capital, ranging from 5% or a fixed amount between P100,000 and P1 million under the tax amnesty proposal, DoF Director Euvimil Nina R. Asuncion said.

“There will be no Bureau of Internal Revenue (BIR) examination of books for amnesty-covered years,” she said at the same hearing, adding that those who will avail of the program would be immune from civil, criminal and administrative penalties.

Ms. Asuncion said taxpayers who avail themselves of the proposed general tax amnesty within the first three months of its implementation will receive a 20% discount. The discount would drop to 15% from the third to sixth month of implementation, and to 10% in the sixth and ninth month of implementation.

“Excluded from the general tax amnesty are those taxpayers with pending court cases related to those under the Presidential Commission on Good Government’s jurisdiction, anti-graft and money laundering and tax evasion,” Ms. Asuncion said.

The government is also keen on pushing an estate tax amnesty, after it expired in June, she added. “We want to extend this up to June 30, 2028.”

Ms. Asuncion said the estate tax amnesty would cover estates with unpaid taxes as of May 2024.

“The rate will remain at 6% and it will cover estates of descendants with the date of death on or before May 31, 2024,” she said.

The government collected PHP 1.36 billion from 42,373 taxpayers under the estate tax amnesty in 2022, PHP 1.89 billion from 51,400 taxpayers in 2023, and P2.66 billion from 56,901 taxpayers in 2024, a copy of BIR’s presentation to lawmakers obtained by BusinessWorld showed.

About PHP 4.18 billion from 92,066 taxpayers were collected in the first seven months of 2025.

VAT cut

Meanwhile, DoF’s Mr. Adriano said a House proposal to cut the value-added tax (VAT) rate to 10% from the current 12% could widen the budget deficit if enacted.

Batangas Rep. Leandro Antonio L. Leviste filed House Bill (HB) No. 4302 on Tuesday seeking to lower the VAT rate, arguing the current tax system is “regressive” and should be reduced to make taxation more progressive.

“That will have an impact. A big one,” Mr. Adriano told BusinessWorld in Filipino. “It could cost several billions, assuming there will be no new other [taxes] to offset losses.”

The BIR collected PHP 467 billion in VAT during the first seven months of the year, nearing the government’s PHP 473-billion full-year target, according to its presentation to lawmakers.

“The assumption is that VAT is regressive. But we’d like to point out that it can be progressive if exemptions are in place — which we already have,” Mr. Adriano said. “For example, food and agricultural products are exempt from VAT, and these account for about 40-50% of spending by the poorest households.”

HB No. 4302 also seeks to empower the government to return the VAT rate back to 12% for a year if the projected deficit is expected to exceed the programmed deficit.

Mr. Leviste, a former businessman, told reporters on Wednesday that he will push for a “wealth” tax to offset possible revenue losses.

“We want it to be a revenue-neutral bill, replacing a portion of the value-added tax with a more progressive wealth tax,” he said. “Instead of collecting… from the poor, we can collect those revenues from the wealthiest Filipinos.”

Mr. Leviste divested his stake in SP New Energy Corp. (SPNEC) before becoming a lawmaker. He sold around 16.44 billion SPNEC shares for PHP 20.49 billion. — Kenneth Christiane L. Basilio, Reporter

The Economy and Development (ED) Council has approved a resolution to tighten the approval process for flood control projects, as the government intensifies its investigation into alleged corruption within the Department of Public Works and Highways (DPWH).

In a statement on Wednesday, the Department of Finance said the ED Council’s Investment Coordination Committee-Cabinet Committee (ICC-CC) endorsed a resolution mandating a “comprehensive review” of flood control initiatives.

The resolution, approved on Aug. 12, was recommended by the Infrastructure Development Committee’s Sub-Committee on Water Resources.

Under the new guidelines, flood control and management projects will be aggregated by river basin rather than evaluated individually with lower tagged costs.

This addresses a gap in current ICC rules, which only require a review for projects exceeding PHP 2.5 billion, which leaves most flood control projects outside the ICC’s scope.

“By aggregating flood control and management projects in a single river basin, more of these projects will be subjected to the ICC evaluation, particularly in the aspects of technical, environmental, social, and economic viability, among others,” the Council said.

The Council said this resolution is expected to improve project quality and readiness, while promoting a unified strategy for long-term flood mitigation.

The resolution also designates the DPWH as the lead agency responsible for submitting aggregated projects to the ICC.

Following the approval made by the ICC-CC and its endorsement to the InfraCom-CC, the resolution will be elevated for the ED Council’s consideration and final decision.

Finance Secretary Ralph G. Recto said corruption related to flood control projects may have cost the Philippines up PHP 118.5 billion in economic losses since 2023. — Aubrey Rose A. Inosante

Corruption related to flood control projects have cost the Philippines up to PHP 118.5 billion in economic losses since 2023, Finance Secretary Ralph G. Recto said on Tuesday.

“Due to ‘ghost’ projects, our economy lost between PHP 42.3 billion and PHP 118.5 billion from 2023 to 2025,” Mr. Recto said in his presentation during a Senate Finance Committee hearing.

These estimated average economic losses are based on information from “anecdotal accounts” that put the extent of corruption in the Department of Public Works and Highways’ (DPWH) flood control projects at around 25% to 70% of the total project cost, the presentation showed.

These could have translated to 95,000 to 266,000 jobs for Filipinos, Mr. Recto said.

These allegedly anomalous projects not only drained public funds but also stunted economic growth in the previous years, the Finance chief said.

Philippine gross domestic product (GDP) grew by 5.5% in 2023 and 5.7% in 2024.

“We just learned that the extent of the problem with flood control is this big. Maybe if that money was spent better, we could have grown by 6%,” Mr. Recto told reporters.

“It’s a waste. The economy would have grown at a faster rate. If the money wasn’t wasted, more jobs would have been created.”

He added that the controversy could also dampen investor confidence in the Philippines.

Still, the economy remains on track to meet the government’s 5.5%-6.5% growth target for 2025 despite higher tariffs and adverse weather conditions, Mr. Recto said.

Philippine GDP grew by 5.5% in the second quarter, bringing the first-semester average to 5.4%, a tad below the state’s goal.

The government has launched a widespread probe into alleged anomalies in multibillion-peso flood control programs, which have long been flagged for irregularities as the Philippines faces more weather disturbances.

The DPWH is among the largest recipients of the national budget, securing more than PHP 900 billion this year, a substantial share of which is earmarked for flood control projects nationwide.

President Ferdinand R. Marcos, Jr. earlier said that some PHP 100 billion of the total PHP 545 billion in government funds that were allocated for flood control projects nationwide since 2022 were cornered by just 15 contractors.

Over the weekend, Mr. Marcos appointed former Transportation Secretary Vivencio “Vince” B. Dizon as the new Public Works chief after the resignation of Manuel M. Bonoan.

The President also set up an independent commission to investigate flood control anomalies to further reinforce accountability.

Mr. Recto said the government’s tax collecting agencies are ramping up their probe into the contractors that benefited from these allegedly anomalous projects.

The Bureau of Customs on Tuesday issued a search warrant for the luxury vehicles of the Discayas in Pasig City, but only two out of 12 cars were found during the search.

Among the top 15 flood-control contractors earlier identified by Mr. Marcos were Omega & Alpha Construction and St. Timothy Construction, both reportedly linked to former Pasig mayoral candidate Cezarah Rowena “Sarah” Discaya.

“The Bureau of Customs takes the issue of the missing luxury cars of Discaya with utmost seriousness. We will ensure that these vehicles are located without delay, and if discrepancies are uncovered, all taxes and duties will be collected in full,” Customs Commissioner Ariel F. Nepomuceno said in a statement.

Mr. Nepomuceno has warned that hiding or abetting the concealment of these cars will be punished to the “fullest extent of the law.”

Meanwhile, the Bureau of Internal Revenue has served letters of authority to the tagged contractors.

Analysts have long flagged corruption as one of the biggest risks to Philippine economic growth.

Philippine Institute for Development Studies Senior Research Fellow John Paolo R. Rivera said corruption is not just a governance issue but also a direct economic cost.

“Losses in flood-control projects represent funds that could have gone to infrastructure, jobs, and social services,” Mr. Rivera said in a Viber message.

He described Mr. Recto’s estimate as “realistic,” citing the multiplier effects of efficient public spending.

“The challenge now is to tighten transparency and accountability so that public funds truly translate into inclusive growth,” he added.

Foundation for Economic Freedom President Calixto V. Chikiamco said all kinds of corruption end up as economic losses.

“Corruption exists everywhere, but it hasn’t stopped Vietnam from growing fast,” Mr. Chikiamco said in a Viber message.

Meanwhile, Filomeno S. Sta. Ana III, coordinator of Action for Economic Reforms, called Mr. Recto’s statement “hypocritical” and “deceiving” as fund transfers from state-run agencies — some of which were stopped by the Supreme Court — were approved under his watch.

“Find the link between the infra projects tainted with corruption and the transfer of PhilHealth (Philippine Health Insurance Corp.) and PDIC (Philippine Deposit Insurance Corp.) funds that enabled the funding of these highly questionable projects,” he said in a Viber message.

In 2024, the government initiated the transfer of PHP 89.9 billion from PhilHealth to the National Treasury, labeling these as “excess funds.” The money was supposed to fund various projects, including infrastructure and social services.

The High Court in October issued a temporary restraining order to stop the last tranche of transfers worth PHP 29.9 billion.

Meanwhile, in January, the PDIC remitted excess funds amounting to PHP 107.23 billion to the Treasury. — Aubrey Rose A. Inosante, Reporter

Poor Filipinos will likely remain unable to afford housing even under the government’s expanded flagship program due to low wages and the lack of job security, according to a research paper published by the University of the Philippines Center for Integrative and Development Studies. 

“While the Expanded 4PH provides diverse housing options, it may still fall short in improving affordability and accessibility for the poorest and is unlikely to address broader structural barriers without broader structural reforms,” according to the study authored by Rafael Vicente V. Dimalanta, Vincent Eugenio, Abigail Roa, and Jay-R Panagsagan.

“The diversification of modalities has yet to resolve the core accessibility and affordability challenges of social housing for the poorest, shaped by broader structural issues such as low wages, precarious work, and weak land governance,” it said.

The study estimated that it would cost a total of PHP 8,324.06 monthly to avail oneself of a housing unit under the expanded Pambansang Pabahay Para sa Pilipino (4PH) Program.

This comes as a mid-range high-rise unit under the 4PH Program that costs PHP 1.5 million will require a monthly amortization of PHP 6,324.06 for the first 10 years, according to government data. The researchers said a 4PH beneficiary may incur further additional expenses related to high-rise living, such as maintenance and operational fees, which could amount to PHP 2,000.

Citing data from the Philippine Statistics Authority, the study noted that Filipino households belonging to the bottom 30% of income deciles — the “primary beneficiaries” of 4PH — earn monthly incomes of only PHP 11,940. (first decile), PHP 15,217.50 (second decile), and PHP 17,369.17 (third decile), respectively.

“Based on these figures, the housing payment for a mid-priced Expanded 4PH vertical unit would consume 59.35% of total household expenditures for the bottom 10% income earners, 49.06% for the bottom 20%, and 43.99% for the bottom 30%,” according to the study.

Many of these poor households work in the informal economy, receiving low or irregular wages while working under a short-term or contractual tenure.

The bottom 30% segment is also linked to informal settler families who cannot afford to enter the formal housing market, it added.

“Given the income and expenditure profiles of the poorest households in the lowest 30% income deciles, it is evident that the combined costs associated with the Expanded 4PH significantly exceed the financial capacity of the program’s priority beneficiaries,” according to the researchers.

Launched in 2022, the 4PH seeks to end the country’s housing backlog by building six million housing units by 2028. However, only 1,900 units have been completed under the program since its launch, Human Settlements and Urban Development Secretary Jose Ramon P. Aliling told congressmen on Monday.

The government has kept a “manageable” goal of building 300,000 houses by 2028, Mr. Aliling said, but noted that it cannot hit the target if the 4PH program itself is not strengthened.

To better support beneficiaries, the expanded 4PH program allowed both vertical and horizontal or subdivision-type housing options.

It also included rental and incremental housing to consider beneficiaries’ financial situation and revived the community mortgage financing program by the Social Housing Finance Corp.

To become a 4PH beneficiary, an individual must be a member of the Home Development Mutual Fund or Pag-IBIG Fund.

However, the study noted that this poses a barrier, especially for informal workers with stagnant and low wages.

“The program’s financing structure and restrictive criteria thus reinforce exclusion undermining its stated goal of prioritizing the poorest who are most in need of housing,” the researchers said.

The study recommended aligning the program’s socialized housing amortization and rent with the financial capacity of the poorest households to ensure that their basic needs are not compromised.

It also cited the need to increase the government’s housing budget and lessen its dependence on the private sector in constructing 4PH units to make them more affordable to poor beneficiaries.

The government must also make its eligibility criteria more flexible for irregular or informal workers, ensure the participation of urban poor groups in planning and implementation processes, and address bureaucratic delays, it said.

“These recommendations should be complemented by strengthened land governance to control speculation and the rapid escalation of land prices, which significantly hinders the government’s ability to make land available for social housing, and eventually undermines the affordability of land for social housing for the poorest.” — Beatriz Marie D. Cruz, Reporter