Senate Finance Committee chair Win Gatchalian raised concern over several items vetoed by President Bongbong Marcos in the 2026 national budget, warning that the decision leaves major government obligations unsettled and could affect foreign assisted projects expected later this year.
Marcos signed the 2026 General Appropriations Act into law after vetoing ₱92.5 billion worth of unprogrammed appropriations. Among the items struck out were the Fiscal Support to the Comprehensive Automotive Resurgence Strategy program, originally allotted ₱4.321 billion, and the Revitalizing the Automotive Industry for Competitiveness Enhancement program, which had ₱250 million.
Gatchalian said the two programs were intended to cover tax incentives promised by the government to automotive manufacturers Toyota and Mitsubishi to encourage their investments in the Philippines.
At a press briefing on January 6, Gatchalian said the incentives had not been released for the past four to five years, creating the impression that the two companies still owed taxes to the Bureau of Internal Revenue.
“The problem is that Mitsubishi and Toyota’s books still show a debt to the BIR. That needs to be cleared and removed from those books. These unprogrammed funds were supposed to be the solution,” Gatchalian said.
He explained that under the incentive scheme, the obligation to the BIR should be shouldered by the government as part of the tax incentives promised to the firms.
Marcos, in his veto message, said the removal of the CARS and RACE items was part of a broader effort to restore public trust in the budget process following corruption allegations involving multibillion peso kickbacks in public works projects.
“The veto of these items is a measured exercise of executive authority to rebuild public trust in the budget process, by ensuring that public funds are expended in clear service of national interests,” Marcos said.
Gatchalian said one possible workaround for the removal of the automotive program allocations would be to tap the President’s contingent fund or other available funding sources.
The President also vetoed ₱35.769 billion allocated as the government counterpart for certain foreign assisted projects. Marcos said funding for such projects is already lodged under the appropriate implementing agencies.
Gatchalian said he remains concerned, noting that several foreign assisted projects are expected to come in later in the year and may require additional funding.
He said the administration may again have to rely on the contingent fund if existing line items prove insufficient to cover incoming projects.
