December 2, 2022

By 2022, local government units across the country will have bigger internal revenue allotment shares as the national government will be implementing a 2018 Supreme Court ruling that said LGUs should get more share from the national internal revenue.
National Economic Development Authority OIC Regional Director Stephanie Christiansen said in a recent press conference that the Department of the Interior and Local Government has been rendering technical assistance to LGUs to capacitate them when some functions of the national government will be devolved to LGUs, in view of the fact that more funds given to LGUs translate to more services to be rendered in the local level than by national government agencies.
Focus of the technical assistance is on budget preparations with aim to strengthen the LGUs absorptive capacity or the ability to use or spend budget allotments on time, and strengthening investment programs.
“We hope that with the technical assistance, there will be more development in the countryside especially that by 2022, LGUs will have more shares from the IRA,” Christiansen said.
In the Cordillera, only Baguio City is less dependent on IRA share from the national government.
In 2018 the SC granted the petitions of Batangas Gov. Hermilando Mandanas and former Bataan Gov. Enrique Garcia who asked that the IRA share of LGUs should come from 40 percent of taxes generated by the national government plus Customs duties and taxes.
The SC has affirmed this ruling in 2019 making the same due for implementation in 2022.
At present, only two-fifth of national internal revenue taxes accrue to LGUs.
The devolution will take effect next year.
The DBM estimates that with the implementation of the Mandanas-Garcia ruling, the LGUs’ 2022 IRA shares sourced from 2019 BIR and Customs collections would increase by 27.61 percent to P1.083 trillion, or 4.75 percent of gross domestic product, instead of only P848.44 billion or 3.72 percent of GDP under the current computation. – Rimaliza A. Opiña