LGU revenues seen to further dive as targets lowered in 2021

MANILA, Philippines—Local governments have been tasked with collecting P223.9 billion in taxes and fees in 2021, a target that had been reduced and is lower than 2020’s projected revenue because of prolonged recession as a result of the COVID-19 pandemic.

In a statement on Monday (Feb. 1), the Department of Finance’s Bureau of Local Government Finance (DOF-BLGF) said that had there been no pandemic, local government units (LGUs) had been programmed to generate revenues of up to P321.6 billion in 2021 or 30-percent higher than the new goal.

But the BLGF said that since the recession-battered 2020 shall be the assessment base year for 2021 dues, provinces were expected to contribute only P32.23 billion; cities, the biggest chunk amounting to P165.2 billion and municipalities, P26.47 billion.

Bulk of LGU revenues projected to be collected this year would come from local business tax and other taxes, with an estimated P97.75 billion; real property tax and special education fund, P76.03 billion; regulatory fees and user charges, P29.76 billion and receipts from local economic enterprises’ operations, P20.35 billion.

On a regional basis, LGUs in Metro Manila were seen to generate P102.07 billion or nearly half of the total. Provinces, cities and towns in Calabarzon and Central Luzon were tasked with collecting P34.14 billion and P19.89 billion, the BLGF said.

While the report on the full-year 2020 collections would come out only by March or April, the BLGF estimated 2020’s LGU revenues to have reached P241.39 billion, 7 percent higher than the 2021 target.

Since most 2020 collections were based on 2019 assessments, LGU revenues from January to September 2020 amounted to P205.71 billion, already surpassing the full-year program of P193.04 billion alongside gradually easing quarantine restrictions.

Prior to the pandemic, the BLGF had set an even higher 2020 revenue target for LGUs at P307.08 billion, but the government had allowed extended payment deadlines as a form of relief to individuals as well as businesses amid the health and socioeconomic crises inflicted by COVID-19.

TSB