The Department of Budget and Management (DBM) on Thursday firmly denied allegations that the ₱1.195-trillion national tax allotment (NTA) for local government units (LGUs) is being treated as a discretionary fund under the national budget.
The clarification came after Batangas Vice Governor Hermilando Mandanas and the Philippine Councilors League (PCL) filed a petition before the Supreme Court challenging the practice of including the NTA in the General Appropriations Act (GAA) before release.
Petitioners argued that this approach could expose LGUs’ share of national taxes to potential executive veto and budgetary control, contravening the principle of automatic release affirmed in the 2018 Mandanas-Garcia ruling.
However, the DBM emphasized that the NTA “exists independently of the GAA” and is grounded in Article X, Section 6 of the 1987 Constitution, which guarantees LGUs a “just share” in national taxes that “shall be automatically released.”
“The (NTA) is not a discretionary appropriation under the General Appropriations Act. It is a constitutional obligation implemented in coordination with, but not created by, the annual budget law,” the agency said.
The department added that including the NTA in budget documents is purely for “transparency, accounting, and fiscal programming,” and does not make it a discretionary fund subject to executive control.