SIXTEENTH CONGRESS ) ees
OF THE REPUBLIC OF THE PHILIPPINES ) Dai
First Regular Session ) Titi
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HOUSE OF REPRESENTATIVES \"e

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House Bill No. 2626 Se

Introduced by Representative Susan A. Yap

EXPLANATORY NOTE

Under Section 6 of Republic Act No. 7160, otherwise known as the ‘Local
Government Code of 1991’, local government units are authorized to cteate barangays
within their territorial jurisdictions by ordinance passed by theit respective legislative
councils or sangyymians. Furthermore, Section 7 of the same law requires that the creation of a
barangay should be based on verifiable indicators of viability and projected capacity to
provide services. Foremost among these indicators is its income which must be sufficient,
based on acceptable standards, to provide for all essential government facilities and services,
as well as special functions, commensurate with the size of its population.

In correlation, under Section 285 of the same Code, barangay units are entitled to
twenty percent (20%) of the internal revenue allotment (IRA) share of local government
units from collected national taxes. However, the same provision directs that the financial
requirements of barangays cteated after the effectivity of the Code shall be borne by the
local government units (LGUs) creating them. Thus, newly created barangays are at the
mercy of their parent LGUs, which if not so concerned will leave said barangays fending for
themselves

Currently, thete ate approximately 42,000 barangays in the Philippines, out which
300 have been very recently established. It has been observed that most of these newly
created barangays were established for political expediency and for the expansion of the
political control of sponsoring politicians in their areas without regard to the capability of the
barangays to support their activities. ‘The situation is patently detrimental to the constituents
of the affected barangays who are deprived of the basic social services that they need and
deserve and should be provided for through their barangays,

In this light, this bill seeks to amend Section 285 of RA 7160 by mandating that
henceforth, the financial requirements of barangays created by local government units shall
be taken from the internal revenue allotment according to the sharing scheme provided for
in the same section. By this measure, it is hoped that these barangays will finally be able to
support the needs of their constituents and capacitate them to provide the basic social
services mandated by law.

For the foregoing reasons, the immediate passage of the bill is earnestly requested

HON. SUSAN Aly:
Representative, Seto
District of Tarlac


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SIXTEENTH CONGRESS )
OF THE REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES

House Bill No, 2626

Introduced by Representative Susan A. Yap

AN ACT

GRANTING INTERNAL REVENUE ALLOTMENT TO
BARANGAYS CREATED BY LOCAL GOVERNMENT UNITS
AFTER THE EFFECTIVITY OF REPUBLIC ACT 7160,
AMENDING FOR THIS PURPOSE SECTION 285 OF REPUBLIC
ACT NO. 7160, AS AMENDED, OTHERWISE KNOWN AS THE
LOCAL GOVERNMENT CODE OF 1991, AND FOR OTHER
PURPOSES

Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled.
SECTION 1. Section 285 of Republic Act No. 7160, as amended, otherwise known

as the Local Government Code of 1991, is hereby further amended to read as follows:

“Section 285. Allocation to Local Government Units, - The share of
the local government units in the internal in the internal revenue allotment

shall be allocated in the following manner

a) Provinces ~ Twenty-three percent (23%)

b) Cities —‘Twenty- three percent (23%)

©) Municipalities- ‘Thirty- four percent (34%) and

) Barangays- Twenty (20%) Provided, however, That the share of
each province, city, municipality shall be determined on the basis
of the following formula:

@) Population ~ Fifty percent

(b) Land Area “Twenty-five percent (25%) and

(©) Equal Sharing: Twenty- five percent (25%)


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Provided, further that the share of each Barangay with a population
of not less than one hundred (100) inhabitants shall not be less than Eighty
thousand: pesos (P 80,000,00) per annum chargeable against the twenty
percent (20%) share of the Barangay from the internal revenue allotment,
and the balance to be allocated on the basis of the following:

(@) On the first year of the effectivity of this code:

(1) Population — Forty percent (40%)
(2) Equal sharing ~ Sixty percent (60%)

(b) On the second year:

(1) Population- Fifty percent (50%), and
(2) Equal sharing- Fifty percent (50%)

(©) On the third year and thereafter

(1) Population ~ Sixty percent (60%); and

(2) Equal sharing- Forty percent (40%)

Provided finally, that DURING THE YEAR IT WAS

CREATED, the financial requirements Barangays created by local

government units after the effectivity of this code shall be the tesponsibility

of the local government unit concerned. IN THE SUCEEDING YEAR

AND EVERY YEAR THEREAFTER, THE FINANCIAL

REQUIREMENTS OF BARANGAYS CREATED BY LOCAL

GOVERNMENT UNITS SHALL BE TAKEN FROM THE

REGULAR INTERNAL REVENUE ALLOTMENT ACCORDING

‘TO THE FORMULA REPRESENTED IN THIS SECTION”

SECTION 2. Separability Clause. - If any provision of this Act, or any part
thereof, is declared unconstitutional, the same shall not affect the validity and effectivity of

the other portions.

SECTION 3. Repealing Clause. - All laws, executive orders, presidential decrees,
proclamations, rules, regulations, issuances and enactments of parts thereof inconsistent with

this Act are hereby repealed or modified accordingly.


1 SECTION 4. Effectivity. - ‘This Act shall take effect fifteen (15) days from its
2 complete publication in the Official Gazette of in a newspaper of general circulation in the

3 Philippines, whichever comes earlier.

Approved,