Local government units (LGUs) are poised for a massive financial boost as their share of national tax revenues is projected to reach ₱1.32 trillion in 2027, climbing from ₱1.19 trillion this year.
Executive Secretary Ralph Recto announced that this substantial 11% increase will take center stage during President Ferdinand Marcos Jr.’s next State of the Nation Address (SONA) this coming July.
“As a former local executive official himself, the President sees and honors these as people’s entitlements. These are guaranteed plowbacks that will go from big cities to the remotest barangays,” Recto noted in a statement on Wednesday.
Known as the National Tax Allotment (NTA), this funding is legally tied to national revenue collections from three years prior, meaning the 2027 pool is directly drawn from 2024 tax collections.
“That indexation is set in stone, beyond alteration. As such, they are in the nature of automatic appropriations,” Recto explained. He added, “Ang sabi kasi ng batas at mga reglamento na ang dividends ng mga lokal na pamahalaan ay batay sa koleksyon ng mga pambansang buwis.”
Recto noted that the NTA will stand out as one of the largest allocations within the 2027 national budget, which is currently being wrapped up by the Department of Budget and Management (DBM).
By constitutional mandate, the President is required to present this budget proposal to Congress within 30 days of the SONA, which is slated for July 27. Individual LGU shares will continue to be calculated primarily based on land area and population.
Distribution of the 2027 NTA Allocation
According to data from the DBM, the ₱1.32 trillion fund will be divided among communities as follows:
- Provinces: ₱303.56 billion split among 83 provinces
- Cities: ₱303.56 billion split among 149 cities
- Municipalities: ₱448.84 billion split among 1,491 towns
- Barangays: ₱263.97 billion split among 41,912 barangays
Top Financial Recipients
In the 2026 allocation cycle, Davao City—the political home of Vice President Sara Duterte, who has become a prominent critic of the Marcos administration—secured the highest individual slice at ₱10.1 billion, enjoying a nearly 15% bump from the prior year.
Meanwhile, the highest-earning local governments across Metro Manila included:
- Quezon City: ₱9.82 billion (Up 15%)
- Manila: ₱6.09 billion (Up 14%)
- Caloocan City: ₱5.5 billion (Up 14%)
- Taguig City: ₱4.4 billion (Up 18%)
- Pasig City: ₱3.05 billion (Up 17%)
This continuous upward trajectory in funding highlights the national government’s ongoing push to reinforce local fiscal independence and deliver vital resources directly to grassroots communities.