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Local Gov't Code: Autonomy & Revenue

The Local Government Code of 1991 established the constitutional basis for decentralization and devolution of powers to local government units in the Philippines. It mandated Congress to enact provisions for allocating powers, responsibilities and resources among LGUs. It increased LGU shares in internal revenue allotment from 30% initially to 40% thereafter. LGUs were also given a 40% share in national wealth generated within their jurisdictions, including from mining, forestry and fisheries. The Code aimed to provide more responsive local governance through fiscal autonomy and own-source revenue generation by LGUs.
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100% found this document useful (1 vote)
381 views26 pages

Local Gov't Code: Autonomy & Revenue

The Local Government Code of 1991 established the constitutional basis for decentralization and devolution of powers to local government units in the Philippines. It mandated Congress to enact provisions for allocating powers, responsibilities and resources among LGUs. It increased LGU shares in internal revenue allotment from 30% initially to 40% thereafter. LGUs were also given a 40% share in national wealth generated within their jurisdictions, including from mining, forestry and fisheries. The Code aimed to provide more responsive local governance through fiscal autonomy and own-source revenue generation by LGUs.
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The constitutional basis in the enactment of the Local

Government Code of 1991.

Local

government units shall


promote the establishment and
operation of people's and
nongovernmental organizations to
become active partners in the
pursuit of local autonomy.

The

territorial and political


subdivisions of the Republic of the
Philippines are the provinces, cities,
municipalities, and barangays. There
shall be autonomous regions in
Muslim Mindanao and the Cordilleras
as herein after provided.

The

territorial and political


subdivisions shall enjoy local
autonomy.

The Congress shall enact a local government


code which shall provide for a more responsive
and accountable local government structure
instituted through a system of decentralization
with effective mechanisms of recall, initiative,
and referendum, allocate among the different
local government units their powers,
responsibilities, and resources, and provide for
the qualifications, election, appointment and
removal, term, salaries, powers and functions
and duties of local officials, and all other
matters relating to the organization and
operation of the local units.

The

President of the Philippines shall


exercise general supervision over local
governments. Provinces with respect to
component cities and municipalities,
and cities and municipalities with
respect to component barangays, shall
ensure that the acts of their
component units are within the scope
of their prescribed powers and
functions.

Each

local government unit shall have


the power to create its own sources of
revenues and to levy taxes, fees and
charges subject to such guidelines
and limitations as the Congress may
provide, consistent with the basic
policy of local autonomy. Such taxes,
fees, and charges shall accrue
exclusively to the local governments.

Local

government units shall have a


just share, as determined by law, in
the national taxes which shall be
automatically released to them.

Local

governments shall be entitled


to an equitable share in the proceeds
of the utilization and development of
the national wealth within their
respective areas, in the manner
provided by law, including sharing
the same with the inhabitants by
way of direct benefits.

Sec.

17 of LGC of 1991, Basic


Services and Facilities.

A. Sec. 17 of LGC of 1991, Basic Services and Facilities.

a. Local government units shall endeavor to be self-reliant and


shall
continue exercising the powers and discharging the duties and
functions currently vested upon them. They shall also
discharge
the functions and responsibilities of national agencies and
offices
devolved to them pursuant to this Code. Local government
units
shall likewise exercise such other powers and discharge such
other
functions and responsibilities as are necessary, appropriate, or
incidental to efficient and effective provision of the basic
services
and facilities enumerated herein.

On Health and Social Services:


1. include the implementation of programs and projects on
primary
health care, maternal and child care, and communicable and
noncommunicable
disease control services;
2. Health services which access to secondary and tertiary
health
services;
3. Purchase of medicines, medical supplies, and equipment
needed
to carry out the services
4. Social welfare services which include programs and
projects on
child and youth welfare, family and community welfare,
women's
welfare, welfare of the elderly and disabled persons;

On Environmental Management:
1. Solid waste disposal system;
2. Services or facilities related to
general hygiene and sanitation;
3. Implementation of communitybased forestry projects which
include integrated social forestry
programs and similar projects;
4. Management and control of
communal forests;

On Agriculture:
1. Inter

-Barangay irrigation system;

Water and soil resource utilization and


conservation projects;
3. Enforcement of fishery laws in
municipal waters including the
conservation of mangroves;
2.

On Infrastructure:
Maintenance and Rehabilitation of the following:
a. roads and bridges
b. school buildings and other facilities for public
elementary
and secondary schools;
c. clinics, health centers and other health facilitie
d. small water impounding projects
e. fish ports; artesian wells, spring development,
rainwater collectors and water supply systems;
f. seawalls, dikes, drainage and sewerage, and
flood control;
g. traffic signals and road signs; and similar
facilities;

On Tourism:
1.Tourism facilities and other tourist
attractions,
2.Acquisition of equipment
3. Regulation and supervision of
business concessions
4. Security services for such facilities

Every

local government unit shall


design and implement its own
organizational structure and staffing
pattern taking into consideration its
service requirements and financial
capability, subject to the minimum
standards and guidelines prescribed
by the Civil Service Commission.

a.

The Sangguniang Bayan, as the


legislative body of the
municipality, shall enact ordinances,
approve resolutions and appropriate
funds for the general welfare of the
municipality and its inhabitants pursuant
to section 16 of this Code and in the
proper exercise of the corporate powers
of the municipality as provided for under
section 22 of this Code, and shall:

Powers, Duties, Functions and Compensation


Sec. 447. of LGC of 1991
(i) Review all ordinances approved by the Sangguniang
Barangay and executive orders issued by the Punong Barangay
to determine whether these are within the scope of the
prescribed powers of the sanggunian and of the Punong
Barangay;
(vii) Subject to the provisions of this Code and pertinent laws,
determine the powers and duties of officials and employees of
the municipality;
(viii) Determine the positions and the salaries, wages,
allowances and other emoluments and benefits of officials and
employees paid wholly or mainly from municipal funds and
provide for expenditures necessary for the proper conduct of
programs, projects, services, and activities of the municipal
government;
It increased the share of the local government units in the
share in the internal revenue taxes as well as taxes in the
utilization and development of national wealth

Local government units shall have a


share in the national internal revenue
taxes based on the collection of the
third fiscal year preceding the current
fiscal year as follows:
a. On the first year of the effectivity of
this Code, thirty percent (30%);
b. On the second year, thirty-five
percent (35%); and
c. On the third year and thereafter, forty
percent (40%).

Allocation to Local Government Units.


- The share of local government units in the internal
revenue allotment shall be allocated in the following
manner:
a. Provinces - Twenty-three percent (23%);
b. Cities - Twenty-three percent (23%);
c. Municipalities - Thirty-four percent (34%); and
d. Barangays - Twenty percent (20%)
Provided, however, That the share of each province,
city, and municipality
shall be determined on the basis of the following
formula:
a. Population - Fifty percent (50%);
b. Land Area - Twenty-five percent (25%); and
c. Equal sharing - Twenty-five percent (25%)

- Local government units shall,


in addition to the internal revenue allotment,
have a share of forty percent (40%) of the
gross collection derived by the national
government from the preceding fiscal year
from mining taxes, royalties, forestry and
fishery charges, and such other taxes, fees, or
charges, including related surcharges,
interests, or fines, and from its share in any
co-production, joint venture or production
sharing agreement in the utilization and
development of the national wealth within
their territorial jurisdiction.
Amount of Share of Local Government Units.

SOURCES OF REVENUE
Locally Generated
Real Property Taxes
Business Taxes
Other Local Taxes
Regulatory Fees
Operation of Local Economic Enterprises
Tolls and Users Charges
Other Sources
Sales/Lease of Assets
Credits
BOT-BT Scheme
National Government
Internal Revenue Allotment
Share from taxes, fees and charges collected form the
development and utilization of national wealth
Other grants and Subsidies
Debt Relief Program

Local

government units shall have


the power and authority to establish
an organization that shall be
responsible for the efficient and
effective implementation of their
development plans, program
objectives and priorities; to create
their own sources of revenue and to
levy taxes, fees, and charges

The

Local Government Code of 1991


provided the policy context for the
emergence of entrepreneurial local
governments by encouraging LGUs
to enter into joint ventures and
partnerships with the private sector
such as build-operate-transfer
arrangement and bond flotation.

THANK YOU &


WASSALAAM!!!

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