Marcos Proposes 7.2 Trillion Peso Budget for 2027

President Ferdinand Marcos Jr. submitted a 7.2 trillion peso ($118.1 billion) proposed national budget for 2027 to the House of Representatives on August 11. The proposal represents a 6% increase over current spending and aims to align with the Philippine Development Plan 2023-2028. To finance the plan and a projected fiscal deficit of 1.7 trillion pesos, the government intends to borrow 3.3 trillion pesos ($54 billion), a 20% increase over the current year's revised borrowing plan.

This borrowing strategy includes 2.39 trillion pesos from domestic sources and 915 billion pesos from foreign creditors, including the World Bank and the Asian Development Bank. To further fund stimulus measures, the government plans to increase sin taxes on soft drinks, alcohol, and e-cigarettes. Consequently, the government raised its budget deficit-to-GDP ratio target to 5.1% for next year.

Spending priorities shift under the new proposal. While education remains the largest priority at 1.15 trillion pesos, it faces funding decreases alongside healthcare and agriculture. In contrast, defense spending is proposed to rise to 328.8 billion pesos. The Department of Public Works and Highways will see a 22% increase to 644 billion pesos, following previous cuts linked to a public works graft scandal. The administration targets a GDP growth rate of 5.0% to 6.0% for 2027 through 2030.