LGUs to Get Smaller Share From National Govt

Local Government Units (LGUs) are encouraged to depend less on the National Tax Allotment (NTA) as the national government will allot a smaller share for next year’s budget. LGUs are asked to look for other possible fund sources.

The Bureau of Government Finance (BLGF) Director Ricardo L. Bobis Jr. has mentioned that LGUs can potentially look at upgrading their tax collection and updating their local revenue code.

“There are ways to generate local revenues, such as improving real property tax collection and the process of collection,” he added. “Make delinquent taxpayers pay, improve business tax collection and regularly examine books,” says Director Bobis.

“LGUs must break away from NTA dependence,”  he adds.

Implementing the Supreme Court’s Mandanas Ruling expanded the annual revenue base to establish the NTA share to LGUs.  Due to pandemic lockdowns which caused an economic slowdown, the national government revenue also declined in 2020.

The estimated LGU share of the NTA for 2023 is estimated to be around ₱820 billion or a 14.5% decrease compared to the ₱959 billion budget for this year. NTA computations are based on collections from the third fiscal year preceding the current fiscal year. For this, the base year was 2020.

On the other hand, the Visayas State University Department of Tourism and Hospitality Management Head Venice B. Ibañez has advised LGUs to probe into tourism as an “opportunity to strategically allocate and optimize the use of its economic resources and funds.”

“It is a potential revenue source and will bring about a vibrant economic environment,” said Ibañez

Source: Business Mirror