Yup. In combination with other things.

Like BlueBimmer says, taxes no longer cover displacement, but actual selling price... which is why we can actually get big-engined V6s for under 2 million pesos now.

Also, cars are getting bigger, thus, they need bigger engines. A good illustration of this is the Nissan Sentra. With the B14 chassis, they were able to wring out nippy low-speed performance from a 1.3. With the N15 chassis (the current one), the 1.3, though technically more powerful than before, suffers a loss in performance. With current "compact" bodies all weighing between 1100-1300 kilograms (not so long ago, mid-sized cars were 1300 kgs!), even 1.6s (as in the case of the Mazda3 and Focus) feel slow... as slow as some 1.3-1.5 liter compacts of yesteryear.

Also, new engines are getting more fuel efficient per displacement, allowing manufacturers to put in larger engines without creating monstrous fuel consumption at idle in traffic.