The Department of Budget and Management (DBM) clarified the reason for the drop in the national tax allotment of local government units in 2023.
Atty. Ryan Lita, director of the DBM-Local Government and Regional Coordination Bureau, denied on Wednesday, July 26, that the lower NTA stemmed from the Mandanas-Garcia Ruling.
Based on the 2018 ruling of the Supreme Court, the NTA, then known as the internal revenue allotment, should come from all national taxes and not just national internal revenue taxes collected by the Bureau of Internal Revenue.
Lita said that the NTA decreased because of the 2019 Coronavirus Disease (COVID-19) pandemic.
The DBM official explained that the annual NTA of LGUs depended on the national taxes collected by the government three years prior.
"Yung shares ng LGU ng 2023 ay naka-based sa collection ng national government noong 2020. Ibig sabihin iyon yung kasagsagan ng pandemya," Lita said during DILG sa DZRH Breaktime.
"Hindi naman ito pangmatagalan kasi sa mga susunod na taon, dahil bumaba na or halos nawawala na yung epekto ng pandemya, gumaganda na rin yung economy natin at tumataas na rin yung collection ng national government," he added.
Lita stressed that the closure of establishments, and several industries reduced the tax collections of the national government.
He also assured that the DBM provides assistance to LGUs in managing their funds as instructed by President Ferdinand Marcos Jr.
"Pinapaigting talaga namin yung aming capacity building programs. Partner namin dito yung DILG at iba pang national government agencies para ituro sa kanila kung papaano yung maayos na pag-implement ng programs and projects," Lita said.
Lita encourages LGUs to improve their collection of local taxes, and non-tax revenues in order to decrease their dependency to NTA.
He said that the digitalization of service could improve the tax collection capabilities of LGUs.
"Yung pag-collect, pag-assesss ng taxes, pwede nilang i-digitalize para ma-encourage yung mga local na namumuhunanan na magbayad ng taxes at hindi na sila pipila ng mahaba," Lita explained.
"Maiiwasan din ang corruption dahil, kung digitalized na ito, exact na ang kanilang babayaran at hindi na naka-base sa kung sino ang kaharap nila na official or empleyado," he added,
