Zero budget for lgus 'unconstitutional'

THE founder of the administration party Partido Demokratiko ng Pilipinas-Lakas ng Bayan (PDP-Laban) on Saturday slammed the “unconstitutional” threat made by House Speaker Pantaleon Alvarez to deprive funding for provinces that do not support the administration’s party’s push for federalism. 

Former Senate President Aquilino Pimentel Jr., whose son is the incumbent Senate President, also warned Alvarez against his power-tripping ways, adding “there is always an end to a man’s power.”

“I don’t think that’s what is stated in the Constitution,” the elder Pimentel told a news briefing in Quezon City. 

Pimentel insisted that lawmakers should defy Alvarez’ threats of depriving their constituents for their rightful share of the budget.

“In the caucuses, for example, you can speak out freely on what you feel so it would be made known to the Speaker that nobody stays in power forever,” Pimentel said. 

RESOURCE PERSONS. Former Senate President Aquilino Pimentel Jr. (right) and Bayan Muna Rep. Carlos Zarate show up at a weekly forum in Quezon City on Saturday to discuss federalism and charter change. 
Manny Palmero
“Now, I’m not saying that there should be a rebellion within the ranks of the bloc that is supporting the Speaker. But the House members should always remember that they are in public service to serve the public. This is not to serve the interest of any one person,” the 84-year old legislator added. 

He also condemned the Davao-born legislator’s inanities when he made such remarks.

The elder Pimentel had earlier urged the public “never to allow any super majority to trample on our rights to speak out” amid proposals by the Congress super majority led by the PDP to preclude elections and extend terms of government officials. 

His son, Aquilino III, serves as the current president of PDP-Laban. Alvarez meanwhile sits as its Secretary-General. 

Alvarez had earlier threatened legislators that provinces which will not support the administration “will get zero budget.” 

“If you don’t want to join, that’s okay. I’ll respect your right. But you also have to respect my right to give you a zero budget,” he said in a speech in Iloilo Thursday. 

In a related development meanwhile, Senate President Pro Tempore Ralph Recto said there was no need for Charter Change when a simple bill could raise local government funds by P283 billion.

RALLY FOR FEDERALISM. President Duterte supporters from different provinces gathered at the Quezon City Memorial Circle during Peoples Congress to call on the president to push through and impelement the country’s shift to federal government. Manny Palmero
In a press relase, Recto said more public funds could be sent to the grassroots without tinkering with the Constitution, an argument that stood fairly against an argument that only through a Charter revision could local governments have a bigger share of tax collections.

Recto said if the intention was to raise the share of provinces, cities, towns and barangays from government income, then such could be done through ordinary legislation.

By Recto’s count, local governments stand to lose P121.5 billion this year due to the “longstanding faulty interpretation of the rule on how the Internal Revenue Allotment (IRA) shall be computed.”

Republic Act No. 7160, or the Local Government Code of 1991, grants LGUs (Local Government Units) a 40-percent share from the national government’s internal revenue collection.

But under the current system, the 40 percent is taken from Bureau of Internal Revenue collections, “but does not include excise and VAT collections of the Bureau of Customs.”

“This is wrong because VAT and excise taxes are classified as internal revenue, and the BOC is a mere collecting agent of the BIR, so in computing the share of LGUs in determining their IRA, BOC’s VAT and excise tax collections must be factored in,” Recto said in a statement.

Recto believes this injustice to LGUs could be rectified through an Executive Order by President Duterte, “as I am sure this is an advocacy he believes in, being a former mayor himself.”

But Recto believes a law passed by Congress is needed to raise the LGUs’ IRA share to 50 percent, to usher in a “fair 50-50, on taxes paid by the people.

Recto has filed three “equal IRA share” bills, which contain other reform provisions like basing the IRA on internal revenues collected two years before, instead of the present three, and allowing the direct remittance of national wealth income, like share from mining, to host LGUs.

“It is unfair for LGUs to wait for three years before they can get their dividends. It is also not right that their share from the exploitation of natural resources in their own places will have to detour to Manila first,” Recto said.

Recto said if “the 50 percent IRA + BOC VAT and excise collections formula” were applied this year, the IRA would have been P804.9 billion, or P282.2 billion bigger than the present P522.7 billion.

Recto said the LGU share can be pegged at 60 percent. 

He said the IRA, which is the mechanism which plows back national tax collections to local governments, needed improvement.

IRA is distributed as follows: 23 percent for provinces, 23 percent for cities, 34 percent for municipalities, and 20 percent for the barangays.

Topics: unconstitutional , LGUs , zero budget
COMMENT DISCLAIMER: Reader comments posted on this Web site are not in any way endorsed by Manila Standard. Comments are views by readers who exercise their right to free expression and they do not necessarily represent or reflect the position or viewpoint of While reserving this publication’s right to delete comments that are deemed offensive, indecent or inconsistent with Manila Standard editorial standards, Manila Standard may not be held liable for any false information posted by readers in this comments section.
AdvertisementSpeaker GMA