The Department of Budget and Management (DBM) said that the budget allocation for local government units (LGUs) will reach over P1 trillion next year.
Based on a memorandum released by the DBM, the total national tax allotment (NTA) for LGUs in 2025 will amount to P1.034 trillion, an 18 percent increase from P871.37 billion this year.
The 2025 NTA is calculated based on tax revenues collected by the Bureau of Internal Revenue (BIR), Bureau of Customs, and other relevant agencies, representing 40 percent of the total national government revenue in 2022.
According to the DBM's report, a total of 43,622 LGUs in the country will benefit from this NTA distribution.
Specifically, the allocations include P237.96 billion for the 83 provinces, P239.04 billion for 149 cities, P350.68 billion for 1,485 municipalities, and P206.92 billion for 41,905 barangays.
The NTA of P776.56 billion is sourced from the BIR, with an additional contribution of P258 billion from the Customs bureau.
Other government agencies provide P41.36 million to the total NTA for next year.
Meanwhile, LGUs are required to use this budget for gender and development, senior citizens, persons with disabilities, HIV/AIDS prevention, and children’s welfare in their 2025 budgets.
Additionally, barangays must allocate 10 percent of their general fund to support the Sangguniang Kabataan council.
The increase in NTA is due to the Mandanas Supreme Court ruling, which has raised LGUs’ share of national tax collections.
LGUs now receive 40 percent of revenues from both the BIR and Customs, instead of just BIR collections previously.