PILI, Camarines Sur –- The League of Provinces of the Philippines (LPP), the organization of provincial governors nationwide, unanimously approved during its 2nd General Assembly held at the Villa del Rey of the Camarines Sur Watersports Center last week, a proposal of Gov. LRay Villafuerte to work towards increasing the share in national taxes of local government units (LGUs).

        Gov. Villafuerte’s proposal calls for increasing the present 60%/40% internal revenue allotment (IRA) sharing to an even 50%/50% split of national taxes, both internal and external, between LGUs and the national government.

        The current IRA is insufficient to enable local governments to deliver public services adequately and it is but fair that LGUs’ share in national revenues be increased, he said.

        The cost of functions devolved to LGUs has been underestimated, added to financial burdens and responsibilities arising from statutory obligations continually being passed on to LGUs, like the salary standardization law, the Magna Carta for Health Workers and financial, personnel and logistical assistance to national government departments and agencies like the DepEd, DA, DENR, PNP, regional trial courts and many others, Gov. Villafuerte explained.

        In fact, the young governor pointed out, provincial governments are particularly disadvantaged in coping with added expenses, considering that provinces have limited taxing powers compared to cities and municipalities which can charge business and community taxes to raise their revenues, while provincial governments cannot.

        Moreover, the share of LGUs in internal revenues which started at 20% of IRA in 1991 when the Local Government Code was passed and has been adjusted to 40% in 1994, the share of LGUs has remained stationary in the past 14 years even while LGUs’ statutory expenses have climbed while the budgets of other departments and agencies have also increased.

        Gov. Villafuerte also pointed out that the Constitution mandates that LGU units shall have a just share in national taxes as determined by law which shall automatically be released to them and has made no distinction between internal revenues and external revenues from tariffs and customs collections.

        In approving Gov. Villafuerte’s proposal, the LPP assembly also directed the formation of a committee of governors knowledgeable in taxation and related matters to pusue the proposal which, if it should succeed, would benefit not only all provincial governments but also all cities and barangays. (GBClaveria)