HOUSE OF REPRESENTATIVES

SEVENTEENTH CONGRESS OF THE ) RECEIVED
_ REPUBLIC OF THE PHILIPPINES) Dare. 08 AUG 2016
First Regular Session ) a
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HOUSE OF REPRESENTATIVES

9e REGISTRATI
H.No._ 2613 BILLS AND INDEX SERVICE

Introduced by Representative Vilma Santos-Recto
6th District of Batangas

AN ACT
STRENGTHENING LOCAL GOVERNMENT UNITS BY INCREASING TO
FIFTY PERCENT (50%) THE ANNUAL INTERNAL REVENUE ALLOTMENT
SHARE OF LOCAL GOVERNMENT UNITS AND FOR OTHER PURPOSES,

Explanatory Note

This bill seeks to promote good governance by local governments units (LGUs)
by increasing LGU share in the internal revenue allotment (IRA) from forty percent
(40%) to fifty percent (50%), With the increase of their share in the national taxes, local
governments shall have greater capability to become effective partners of the national
government in national progress. LGUs are expected to ensure efficient and effective
delivery of basic services; increase local government capacities to generate revenues,
enhance financial management and improve the performance of public economic
enterprises; and improve their mechanisms for transparency and accountability.

Due to the significance of barangays as a basic political unit, it is but just to
promote their welfare and prosperity.Hence, this bill proposes that the ten percent (10%)
increase in the IRA share of LGUs may be used for the payment of compensation,
allowances, emoluments and other privileges such as social security benefits of barangay
officials and volunteer workers.

The total IRA share released to the 43,593 LGUs in 2016amounted to P428.62
billion.'With the proposed 10% increase in the IRA share, the FY 2017 IRA level shall
be P608.61 billionwhich is P121.72 billion or 21.1% higherthan the projected total IRA
share of P480.41 billion (without 10% increase) for all LGUs. The 10% increase in the
IRA share of LGUs, if allocated to barangays, shall be enough to cover their personal
services requirement.

In view of the foregoing, the immediate approy:
requested.

VILMA SANTOS-1

‘Department of Budget and Management. Local Budget Memorandum No. 70 “FY 2016 IRA Level and
Other Local Budget Preparation Matters.” June 15, 2015.


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SEVENTEENTH CONGRESS OF THE )
REPUBLIC OF THE PHILIPPINES —_)
First Regular Session )

HOUSE OF REPRESENTATIVES

H.No._ 2613

Introduced by Representative Vilma Santos-Recto

AN ACT
STRENGTHENING LOCAL GOVERNMENT UNITS BY INCREASING TO
FIFTY PERCENT (50%) THE ANNUAL INTERNAL REVENUE ALLOTMENT
SHARE OF LOCAL GOVERNMENT UNITS AND FOR OTHER PURPOSES.

Be it enacted by the §
Congress assembled:

nate and House of Representatives of the Philippines in

SECTION 1. Short Title—This Act shall be known as the “Equal Income
Sharing Act of 2016”.

SEC. 2.Declaration of Policy. — It is hereby declared the policy of the State to
promote good governance by local government units (LGUs) andempower government
officials and public volunteer workers at the grassroots level.

The Staterecognizes the need of LGUs to have adequate funds to perform its
expenditure responsibilities,

In line with this policy and in cognizance of the crucial role of barangaysas the
primary planning and implementing units of government policies, programs and projects,
the State shall, through the provision of increasing the barangay budget for the payment
of compensation, allowances, emoluments and other privileges such as social security

benefits, protect the rights and promote the welfare of barangay officials and volunteer

workers.

SEC. 3.Increasein the Annual Internal Revenue Allotment (IRA) Share of LGUs. ~
Local government units shall have a share of fifty percent (50%) in the national internal
revenue taxes based on the collection of the third fiscal year preceding the current fiscal
year.

PROVIDED, Thatthe ten percent (10%) increase in the annual internal revenue
allotment may be set aside and used for the payment of compensation, allowances,
emoluments and other privileges such as social security benefits of barangay officials and
volunteer workers.

SEC. 3.Jmplementing Rules and Regulations. The Secretaries of the Department
of the Interior and Local Government in coordination with the Department of Finance

and the Department of Budget and Management, shall jointly within ninety (90) days

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from the effectivity of this Act, formulate and promulgate the rules and regulations to
implement the provisions of this Act.
SEC. 4.Repealing Clause.Section 284 of Republic Act No. 7160 otherwise known,

as the “Local Government Code” is hereby amended. All other laws, orders, decrees,

is s, circulars, rules and regulations or parts thereof which are inconsistent with any

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of the provisions of this Act are hereby repealed or modified accordingly.

SEC. 5.Effectivity Clause. This Act shall take effect fifteen (15) days from the
date of publication in the Official Gazette or in at least two (2) newspapers of general
circulation.

Approved,

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