GOVERNMENT  TO  REMIT  P739 M  TO  LGUs  FROM  LOGGING,  MINING  FEES

MANILA, AUGUST 15, 2007
(STAR) By Paolo Romero - The government will remit P739 million to local governments next year as their share from logging and mining fees, and as part of the planned P218.7 billion tax plowback to them, Budget Secretary Rolando Andaya Jr. said Monday.

Next year’s share of local government units (LGUs) from so-called “national wealth” income is double this year’s allocation of P367.5 million, Andaya said.

“In what could be a reflection of the ongoing mining boom, almost P470 million of the said national wealth allocation programmed for 2008 would come from the minerals sector,” he said.

The bulk of the amount would be in the form of mining taxes, amounting to P421.2 million, and the remaining P48.5 million are royalty payments from mineral reservations, the budget chief said.

Charges from other energy resources would bring in an additional P68.4 million to local government coffers where these are exploited.

The remittance of “national wealth” share to LGUs is mandated by Republic Act 7160, the Local Government Code, which awards them 40 percent of government income from the “development and utilization” of national wealth within their territory.

RA 7160 defines these incomes as “mining taxes and royalties, forestry and fishery charges, and such other taxes, fees or charges including its share in any co-production, joint venture or production sharing activities.”

This year’s P367.5-million allocation in the General Appropriations Act for the national wealth share of LGUs does not include the P160 million withheld by the Bureau of Internal Revenue from mining taxes and which are immediately placed in a Trust Fund earmarked for qualified LGUs.

In all, the LGU slice from the “national wealth” pie is P527.5 million this year, Andaya said.

Next year’s allocation also includes P160 million to settle prior years’ arrears, he said.

“This is a continuation of the government’s program to wipe the slate clean, which began last year when it allocated P670 million to liquidate unpaid national wealth receipts from 1997 to 2003,” he said.

Andaya said the arrears were incurred due to lack of appropriation cover, which in turn was caused by the delay in the submission of certifications by collecting agencies.

National wealth income remittance to LGUs is just one of the items in the P218.7-billion Allocation to Local Government Units outlay for 2008, of which Internal Revenue Allotment (IRA), with P210.73 billion, is the biggest item.

Government is also increasing by P440 million, to P3.98 billion next year, the share of local governments from value-added tax collection.

Under Republic Act 7643, local governments will get 20 percent of 50 percent of any incremental collection from VAT.

The annual IRA, on the other hand, is pegged at 40 percent of the BIR collection three years before.


Chief News Editor: Sol Jose Vanzi

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