Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Batasan Hills, Quezon City 
NINETEENTH CONGRESS 
Second Regular Session 
HOUSE BILL NO. 10513 
Introduced by  
HON. ATTY. GERVILLE “JINKY BITRICS” R. LUISTRO 
AN ACT INSTITUTIONALIZING THE INCOME CLASSIFICATION OF 
BARANGAYS, PROVIDING A BARANGAY EQUALIZATION FUND, AND FOR 
OTHER PURPOSES 
EXPLANATORY NOTE 
Under Republic Act. 7160 otherwise known as the Local Government Code of 1991, barangays 
as the smallest political unit under the executive branch are tasked with the planning and 
implementation of government policies and programs in the community level. It can be expected 
that barangays, as a political unit that operates closest with its constituents, to have a better grasp 
of needs of the community, providing the most basic of public services and pursuing programs 
that aim to develop constituents’ living and economic conditions and improve overall quality of 
life.  
Not all barangays, however, are equal in the resources available to them. Even with the so-called 
Mandanas Ruling which increases the just shares of Local Government Units (LGUs) from 
national tax collections, LGUs identified in the lower-income class municipalities might not 
generate enough resources to effectively deliver government programs and services.  
This bill seeks to address the budgetary deficiencies that impede barangays, especially those 
from lower-income class municipalities, from effectively delivering programs and services to the 
people as a budgetary augmentation measure. In particular, this bill will help support barangay 
programs aimed at infrastructure development, livelihood promotion, social service delivery, as 
well as improving nutrition at the barangay level. 
June 6, 2024
5:02 pm


In the 18th Congress, this bill was filed by Rep. Ron P. Salo which was primarily referred to the 
Committee on Local Government. 
In view of the foregoing, approval of the Bill is earnestly sought. 
HON. ATTY. GERVILLE “JINKY BITRICS” R. LUISTRO 


Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Batasan Hills, Quezon City 
NINETEENTH CONGRESS 
Second Regular Session 
HOUSE BILL NO. 10513 
Introduced by  
HON. ATTY. GERVILLE “JINKY BITRICS” R. LUISTRO 
AN ACT INSTITUTIONALIZING THE INCOME CLASSIFICATION OF 
BARANGAYS, PROVIDING A BARANGAY EQUALIZATION FUND, AND FOR 
OTHER PURPOSES 
Be it enacted by the Senate and the House of Representatives of the Philippines in Congress 
Assembled: 
SECTION 1. Declaration of Policy. Section 9, Article I of the 1987 Constitution states 
that "the State shall promote a just and dynamic social order that will ensure the prosperity and 
independence of the nation and free the people from poverty through policies that provide 
adequate social services, promote full employment, a rising standard of living, and an improved 
quality of life for all." 
SECTION 2. Barangay Equalization Fund. There shall be included in the annual 
national budget a Barangay Equalization Fund for every barangay. The appropriation of each 
barangay shall be based on the Philippine Statistics Authority's income classification of the city 
or municipality in which the barangay belongs. The Barangay Equalization Fund shall be on top 
of the Internal Revenue Allotment share that each barangay is already receiving from the 
national government. 
a.
Every barangay of Fourth, Fifth and Sixth Class municipalities shall receive an
annual appropriation of six million pesos (₱ 6,000,000.00)
b. Every barangay of First, Second and Third Class municipalities shall receive an
annual appropriation of five million pesos (₱ 5,000,000.00).
c.
Every barangay of Fourth, Fifth and Sixth Class cities shall receive an annual
appropriation of four million pesos (₱ 4,000,000.00).


d. Every barangay of First, Second and Third Class cities shall receive an annual 
appropriation of three million pesos (₱ 3,000,000.00). 
SECTION 3. Trust Fund Classification. The Barangay Equalization Fund shall be 
released annually to every barangay before March 1st of the calendar year and shall be treated as 
a trust fund in their annual budget. 
SECTION 4. Exclusive Allocation. The fund shall be solely allocated for the upliftment 
of the economic life of the constituents of the barangay, and shall specifically be allotted as 
follows: 
a. Twenty-five per cent (25%) shall be allocated for infrastructure development; 
b. Twenty-five per cent (25%) shall be allocated for livelihood programs; 
c. Twenty-five per cent (25%) shall be allocated for social services such as medical,  
educational, transportation, burial, and food subsidy assistance; and, 
d. Twenty-five per cent (25%) shall be allocated for a barangay nutrition program. 
Not more than 5% of the allocated amount shall be spent for administration of any of the 
aforesaid program or project. 
SECTION 5. Prohibited Acts. Any public officer accountable for the Barangay 
Equalization Fund who shall take or misappropriate, or shall consent or permit, through 
abandonment or negligence, any other person to take such public funds or property, wholly or 
partially, shall be liable for misappropriation or malversation of such funds or property, and shall 
suffer the penalties prescribed in Article 217 of the Revised Penal Code. 
SECTION 6. Implementing Rules and Regulations. Within ninety (90) days from the 
effectivity of this Act, the Department of Budget and Management, Department of Finance, and 
the Department of the Interior and Local Government, shall promulgate the implementing rules 
and regulations of this Act. 
SECTION 7. Appropriations. The amount necessary for the initial implementation of 
this Act shall be included in the annual General Appropriations Act. 
SECTION 8. Separability Clause. If any provision or part of this Act is declared invalid 
or unconstitutional, the remaining parts or provisions not affected thereby shall continue to be in 
full force and effect. 
SECTION 9. Repealing Clause. All laws, executive orders, and administrative orders, or 
parts thereof, inconsistent with any provision of this Act are hereby repealed or amended 
accordingly. 


SECTION 10. Effectivity Clause. This Act shall take effect fifteen (15) days after its 
publication in the online version of the Official Gazette or in two (2) newspapers of general 
circulation. 
 
Approved,