Government urged to include other income in tax sharing scheme

BAGUIO CITY – Mayor Mauricio G. Domogan urged the national government to include other sources of income in the lump sum fund being equitably divided among local governments to increase the share of local governments from the income derived by the government from various sources

The local chief executive said the current practice of the national government is to segregate a portion of the Bureau of Internal Revenue (BIR) collection to be divided between the national government and the local governments in a 60-40 sharing scheme pursuant to the provisions of the Local Government Code of the Philippines.

“The reason why local governments are getting a meagre share from the national government is because not all the 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 pointed out 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 (BOC), the fees collected by the Land Transportation Office (LTO) and other revenue-generating agencies so that local governments will get a bigger share of the fund that goes to priority development projects of local governments as well as improved delivery of basic services to the people.

To help spur rural development, he suggested that the collection from all revenue-generating agencies be pooled together in a lump sum fund whereby a portion will be segregated purposely to pay the national debt while the remaining balance will be equitably divided between the national government and the local governments.

According to him, currently, the income from the operations of the Philippine Amusement and Gaming Corporation (PAGCOR), the Philippine Charity Sweepstakes Office (PCSO) 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.

Domogan argued providing local governments increased share from the revenues generated by various agencies will help them become more independent through the increased priority development projects that will translate to better local income and improved delivery of basic services in preparation for the move to shift to a federal form of government in the coming years.

He claimed issues on revenue-generation and taxation will surely be a sensitive issue once the government will start shifting from the current presidential form to federal because each of the states that will be established will have the power to impose taxes within their prescribed geographical jurisdiction.

He rallied local officials to join in calling the attention of the national government to include its other sources of revenue in the share of local governments from the nationally generated taxes among other revenue sources./By Dexter A. See#


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