The DoF specifies the determination of National Tax Allotment shares for LGUs

The Department of Finance (DoF) has reaffirmed its commitment to transparency and strict adherence to the Supreme Court (SC) ruling and relevant laws in determining the National Tax Allotment (NTA) shares of local government units (LGUs).

“We assure our LGUs that we are strictly adhering to openness and accountability, especially with the principles set by the Supreme Court, in implementing the Mandanas-Garcia decision. Nothing has been changed. We are very welcome and open to ongoing discussions with our LGUs to help them strengthen their financial capacity and improve resource utilization to deliver more and better services to the Filipino people,” said Finance Secretary Ralph G. Recto.

The Mandanas-Garcia SC decision of 2019, which went into effect in 2022, increased the NTA shares of LGUs to 40% of all national taxes in addition to those collected by the Bureau of Internal Revenue (BIR). This amendment was intended to improve the fiscal autonomy of LGUs by giving them a larger share of the national tax base.

In its decision, the SC ordered the Secretary of the DoF, the Secretary of the Department of Budget and Management (DBM), the Commissioners of the BIR and the Bureau of Customs (BoC), and the Department of National Finance, to file all national taxes. collections in the calculation of the NTA base, “except for those accumulated in funds with special purposes and special allocations for the use and development of national wealth.”

In determining the deductions, the DoF is guided by the SC decision including Section 29 (3), Section VI and Section 7, Section X of the 1987 Constitution.

The chief financial officer is expected to meet with the Association of Cities next week to discuss the calculation of the NTA.

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