Chiz tells LGUs not to count on windfall from Mandanas ruling on IRA

Chiz tells LGUs not to count on windfall from Mandanas ruling on IRA

By Ernie Reyes

MANILA — Sorsogon Gov. Chiz Escudero is advising his fellow local chief executives not to count on the additional P234 billion in internal revenue allotment (IRA) expected this year as the national government complies with the Mandanas ruling of the Supreme Court.

Escudero, a veteran legislator, said the cost of the full devolution of services mandated by Executive Order 138 would be twice as much as what local government units (LGUs) are entitled to receive from the national tax collection. He used 2021 data to estimate the gap between the increased IRA and the increased cost of newly devolved services.

“Inisa-isa ko iyon sa national budget ng 2021 dahil line item naman ng budget. Ang kabuuang halaga ng dini-devolve nila sa LGU ay humigit-kumulang P1.3 trillion samantalang ang dagdag na IRA na bigay ng Mandanas ruling ay P695 billion lamang,” said Escudero.

“In other words, they devolved double the amount of what they will be giving LGUs. Iyon pa lang kukulangin palagi yung pondo ng LGUs,” he said.

According to the Department of Budget and Management (DBM), the total IRA for LGUs is projected to increase by 55.7%, from P695.49 billion in 2021 to PHP 1.083 trillion in 2022, which is 4.75% of the country’s gross domestic product (GDP). This is based on the national tax collections in 2019, when the Supreme Court made the landmark decision giving LGUs greater share in national revenue.

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