BAGUIO CITY—Mayor Mauricio G. Domogan has urged the national government to include other sources of income in a lump sum fund being divided among local governments to increase the share of the localities from the income derived by the government from various sources.
Domogan said the current practice of the national government is to segregate a portion of the Bureau of Internal Revenue collection to be divided between the national government and the local governments in a 60-40 sharing scheme, following the provisions of the Local Government Code of the Philippines.
“The reason why local governments are getting a meager share from the national government is because not all sources of revenue are included in the lump sum fund, where the local governments get their 40 percent share, now called the Internal Revenue Allotment,” Domogan stressed.
He said the national government should be “fair in sharing its income and resources” by including in the lump sum fund the collection of the Bureau of Customs, the Land Transportation Office, and other revenue-generating agencies.
That way, local governments will get a bigger share of the fund that would goes to their priority development projects, as well as improve their delivery of basic services to the people, Domogan added.
To help spur rural development, he suggested the collection from all revenue-generating agencies be pooled together in a lump sum fund, where a portion will be set aside purposely to pay the national debt, while the balance would be equitably divided between the national government and the local governments.
The mayor said that currently, the income from the operations of the Philippine Amusement and Gaming Corp., the Philippine Charity Sweepstakes Office, and other government-owned and controlled corporations remain with the national government, “but local governments also deserve an equitable share of the income derived from these revenue-generating offices.”
Providing local governments an increased share from these agencies “will help them become more independent” through the increased priority development projects that would “translate to better local income and improved delivery of basic services” in preparation for the shift to a federal form of government as pushed by the Duterte administration, Domogan said.
Issues on revenue generation and taxation “will surely be a sensitive issue” once the government will start shifting from the current presidential form to a federal one “because each of the states that will be established will have the power to impose taxes within their prescribed geographical jurisdiction.”
He rallied local government officials to join him in calling on national government to include its other sources of revenue in the share of local governments.