The Philippine Councilors League (PCL) and Batangas Vice Governor Hermilando Mandanas have petitioned the Supreme Court to declare unconstitutional the inclusion of the ₱1.19 trillion National Tax Allotment (NTA) for local government units (LGUs) in the 2026 General Appropriations Act (GAA).
Filed on Tuesday, March 3, the petition names Executive Secretary Ralph Recto, Finance Secretary Frederic Go, Acting Budget Secretary Rolando Toledo, National Treasurer Sharn Almanza, and Economy Secretary Arsenio Balicasan as respondents.
The petitioners argue that the government violated Section 6, Article X of the 1987 Constitution, which guarantees LGUs an automatic share in national taxes—not subject to legislative appropriation.
“Treating the NTA as an appropriation negates the State’s policy of ensuring local autonomy. It imposes unnecessary restrictions on the automatic release mandated by the Constitution and the Local Government Code,” the petition stated.
They further accused the respondents of misapplying Section 29(1), Article VI of the Constitution, which requires legislative appropriation for disbursement of funds.
Petitioners contend this does not apply to the NTA since Section 283 of the National Internal Revenue Code (NIRC) explicitly excludes LGU shares from the national treasury.
“The LGU share is a special fund under Section 29(3), Article VI, meaning it should not be treated as part of the general funds subject to national budgetary control,” they emphasized.
By including the NTA in the GAA, petitioners claim the government has unlawfully reduced LGU funds and exposed them to potential vetoes.
“Subjecting the NTA to GAA mechanisms doesn’t just inconvenience LGUs—it inflicts real harm, defeating the very purpose of fiscal autonomy,” they argued.
The Supreme Court has yet to act on the petition, which seeks to compel the government to release LGU shares automatically, as mandated by the Constitution.