We urgently need to redistribute wealth to all parts of the country so that services are equally delivered even in the far-flung areas now!
On Nov. 30, Bonifacio Day, the Citizens Crime Watch (CCW) launched their “People’s Initiative” or PI to amend Article X of the 1987 Constitution which deals with strengthening local governments. The Union of Local Authorities of the Philippines (ULAP), supported by its member leagues, passed Resolution No. 2018-015 in support of this move. Unlike the Delfin and Lambino petitions which both proposed to revise the Constitution, this PI aims to amend merely the revenue share of LGUs, i.e. #PIRA4LGUs or People’s Initiative on Revenue Amendments for Local Government Units.
Why? Because for 27 long years, Congress has not and will not pass the LGUs’ clamor to increase the IRA in the 1991 Local Government Code! There is even a proposal by DBM to even lower this 40% share to 30%! Secondly, the proposed Federal Constitution seems to be a long shot! PI is the only remaining most viable alternative now that will help prepare the LGUs’ transition to a federal government.
Since the Supreme Court’s favorable decision on the Mandanas and Garcia petitions, that recognized the just share of LGUs to be based on all national taxes including the collections of the Bureau of Customs (BOC), has been further delayed due to OSG’s filing of a motion for reconsideration, the proposed amendment to Section 6, Article X of the 1987 Constitution under the People’s Initiative will thus read:
“Section 6. Local government units shall have a just share in ALL the national taxes, WHICH SHALL NOT BE LESS THAN FIFTY (50%) PERCENT OF TOTAL COLLECTIONS BASED ON THE SECOND YEAR PRECEDING THE CURRENT FISCAL YEAR, AND which shall be automatically released to them.”
Since the supposed IRA payback, amounting to some P1.5Trillion, will not be paid to the LGUs, in order to “catch up”, these additional revenues will directly benefit the communities and strengthen the financial capacity of the LGUs to meet the growing demands of its constituents by providing quality basic services, local programs and projects for the people.
Presently, the LGUs’ IRA, which stands for Internal Revenue Allotment represents an average 15% share of the total national budget in the GAA. With the proposed new IRA, which stands for Increasing Revenue Amendments under the People’s Initiative, LGUs will be guaranteed by no less than the Constitution, a revenue share of at least 26% of the total GAA. In the Asia Pacific, the average share of its sub national governments is 34%. Hence, with this amendment, LGUs’ increased share in public spending will translate to a higher contribution to GNP. With stronger LGUs, we will undoubtedly have a stronger nation!
This change will help bring about local economic development in the rural areas and shift the demand from as well as ease the demand here in Metro Manila where 86% of businesses and financial institutions’ head offices are located. Moreover, the long-standing problem on “inequity” and fiscal gaps, due to the situs of taxation, will partially be solved as well. We urgently need to redistribute wealth to all parts of the country so that services are equally delivered even in the far-flung areas now!
(To be continued….)