Metro Manila (CNN Philippines, July 21) — Local government units (LGUs) saw higher incomes in 2020 compared to the year prior, recent data from the Bureau of Local Government Finance (BLGF) revealed.
In a statement Tuesday, the Department of Finance said the bureau reported ₱825.2 billion in operating income for LGUs last year — 12% higher than the ₱738.54 billion collected in 2019.
The increase is “mainly attributed to the 18 percent growth in the external revenue sources of LGUs, including the IRA (internal revenue allotment), which amounted to P509.65 billion, or 11 percent more than the P457.15 billion they received in 2019,” said BLGF executive director Niño Raymond Alvina.
Other transfers from the national government, also a source of external revenue, climbed to ₱63.9 billion during the year, from ₱27.57 billion in 2019.
The dependence of local governments on external sources of revenues went up to 70% in 2020 compared to 66% the year prior, or an ₱88.83 billion jump from 2019 levels, he added.
“On IRA dependence, provinces showed the highest dependency ratio at 78 percent, followed by municipalities (74 percent) and cities (42 percent) in FY 2020,” the BLGF chief noted.
These sources contributed 8% of LGUs’ total operating incomes in 2020, higher than 2019’s 4%.
Meanwhile, locally sourced revenues reached ₱251.65 billion in 2020. This is slightly lower than the ₱253.88 billion tallied the year before. These revenues cover collections from the real property tax, local business tax, fees and charges, and receipts from economic enterprise.
Provinces, cities and municipalities were able to collect ₱244.19 billion locally, having “surpassed” the adjusted ₱192.24 billion target for 2020, said Alvina.
The National Capital Region posted the highest collections in local revenue sources nationwide, raking in ₱101.94 billion or 42% of the total, followed by Calabarzon and Central Luzon.
The BLGF also reported positive growth rates in locally sourced revenue collections in Eastern Visayas, Zamboanga Peninsula, Northern Mindanao, Davao, SOCCSKSARGEN, and CARAGA. However, “mostly” all other regions in Luzon and Visayas posted declines.
“For 2021, the BLGF is actively monitoring the LGUs’ quarterly fiscal performance as it expects lower revenues this year, since the local taxes will be based on the gross receipts of business establishments in 2020 when the Covid-19 pandemic started,” said the DOF.
