President Ferdinand R. Marcos Jr. will highlight the increase in local government units’ (LGUs) share from national tax collections in his fifth and penultimate State of the Nation Address (SONA) on July 27, Malacañang said Wednesday.
Executive Secretary Ralph Recto said the National Tax Allotment (NTA) for LGUs would reach PHP1.32 trillion in 2027, higher by PHP129.32 billion from the 2026 level, reflecting higher national tax collections and the government’s commitment to strengthening local governance.
“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 (villages),” Recto said in a statement.
The PHP1.19-trillion NTA for 2026 is based on internal revenue collections in 2024, in accordance with the law requiring the allotment to be computing using collections from three years prior.
Recto said the amount would be among the biggest ticket items in the proposed 2027 national budget which is being finalized by the Department of Budget and Management.
Under the NTA allocation formula, around 83 provinces will receive PHP303.56 billion; 149 cities, PHP303.56 billion; 1,491 towns, PHP448.84 billion; and 41,912 villages, PHP263.97 billion.
Recto said the allocation system is “non-partisan, formula-based,” ensuring that LGUs receive their shares automatically and without political intervention.
“That indexation is set in stone, beyond alteration. As such, they are in the nature of automatic appropriations,” he said.
About PHP990.68 billion of the PHP1.19 trillion NTA would come from the Bureau of Internal Revenue collections, PHP329.09 billion from the Bureau of Customs and PHP63.6 million from other collections certified by the Bureau of the Treasury.
Recto noted that an LGU’s share would be determined by its population and land area.
For 2026, Davao City received the largest allocation of PHP10.1 billion.
In Metro Manila, the biggest recipients for 2026 included Quezon City (PHP9.82 billion), Manila (PHP6.09 billion), Caloocan City (PHP5.5 billion), Taguig City (PHP4.40 billion), and Pasig City (PHP3.05 billion).
Aside from the NTA, Recto noted that the Marcos administration increased the Local Government Support Fund (LGSF) to a record high PHP57.87 billion for 2026 to further strengthen partnerships between national agencies and LGUs in implementing development projects.
“The conventional and traditional thinking is that the NTA for LGUs is enough. But the President said we should tap the expertise and resources of LGUs in implementing national projects and programs,” he said.
“In many meetings, he said that treating national government projects as separate from local government projects is a false dichotomy,” Recto added. (PNA)