THE distribution of the National Tax Allotment (NTA) to local governments (LGU) should be more equitable, Sen. Panfilo M. Lacson said, adding that giving smaller localities greater resources will help spur development.
Lacson, who chairs the Senate Committee on Ways and Means, said that under the current NTA formula, smaller towns and provinces receive only a fraction of the allocations received by their bigger and wealthier counterparts.
‘The bigger and wealthier cities receive huge allocations. For example, Davao City and Quezon City get a big NTA allocation – as much as P10 billion. But the shares of very small cities are so small they can hardly feel its impact,’ he said, partly in Filipino, in a radio interview.
‘The problem is the inequitable distribution of LGUs’ share in our national revenues. We must find ways to make it more equitable,’ he added.
The NTA, formerly the Internal Revenue Allotment (IRA), refers to the 40-percent share of national tax collections automatically given to LGUs.
For provinces, cities, and municipalities, each LGU’s share within its category is determined based on population (50 percent), land area (25 percent), and equal sharing (25 percent). For barangays, 60 percent is distributed based on population and 40 percent through equal sharing, subject to the minimum allocation for qualified barangays.
Lacson said one possibility is to distribute ‘excess’ collections to the smaller LGUs.
‘We can distribute it to the smaller LGUs so they have better chances of developing,’ he said.
‘Our administration and policy makers must look at this more closely. Without equitability, the poor suffer more while the rich get richer…That is the disconnect that we must revisit,’ he added.