Tobacco-producing areas to get P10.7B

Tobacco-producing cities and towns will receive a total of P10.7 billion as their share in the excise taxes collected by the government in 2013, the Department of Budget and Management (DBM) said yesterday.

Of the amount to be released to local government units (LGUs) that produce Virginia-type cigarettes as well as Burley and native tobacco, P10.2 billion came from excise taxes slapped on cigarettes, while P503.9 million came from tobacco taxes.

Among the producers of Virginia-type cigarettes, Candon City in Ilocos Sur will get the highest amount of P356.9 million. Besides Candon, the nine other top recipients of the excise tax shares on locally-made Virginia-type cigarettes include seven towns in Ilocos Sur (Cabugao, Magsingal, Narvacan, San Juan, Santa Cruz, Santiago and Sinait), Batac City in Ilocos Norte and Balaoan town in La Union.

“These funds will certainly aid LGUs, especially those with lower annual incomes, to implement projects that will enable tobacco farmers to increase their productivity and income,” Budget Secretary Florencio B. Abad said in a statement.

“Through their fair share of tobacco excise taxes, LGUs will be able to boost their capacity to deliver basic services to communities, which is important for the national government’s goals on redistribution and meaningful devolution,” the Budget chief added.

Under Republic Act (RA) No. 7171, LGUs that manufacture Virginia-type cigarettes get a 15-percent share of national tax collections, of which provincial governments will receive 30 percent; congressional districts will also get 30 percent; while cities and municipalities are the recipients of the remaining 40 percent.

But since the Supreme Court had declared legislators’ so-called “pork barrel” as well as interventions in budget implementation as unconstitutional—hence, prohibited—the releases from collections coming from Virginia tobacco will be distributed only to provincial, city and municipal governments.

Separately, RA 8240 mandated provinces as well as cities and municipalities to receive their respective shares of 10 percent and 90 percent from 15 percent of total excise taxes collected from Burley and native tobacco.

The 10 LGUs with the largest shares from the 2013 tax take from Burley and native tobacco were: Amulong, Cagayan; Narvacan, Ilocos Sur; Aurora, Ilagan City, Mallig, Roxas, Quirino and Tumauini in Isabela; San Jose, Occidental Mindoro, and San Fabian, Pangasinan.

“To ensure transparency and accountability in the use of the shares, LGUs are required to submit details of the programs and for implementation based on their individual shares. LGUs must also prepare and publish quarterly reports on fund utilization and the status of project/program implementation,” Abad said.