LGUs get P18-billion share from tobacco excise tax collection

MANILA, Philippines — Tobacco-producing local government units (LGUs) are set to receive P18 billion as their share from the gov­ernment’s tobacco excise tax collections in 2017, the Depart­ment of Budget and Manage­ment (DBM) said.

This is based on Local Bud­get Memorandum 81, issued by Budget Secretary Wendel Avisado on Thursday, which provides the guidelines on the release and utilization of the LGU shares from the 2017 collection of excise taxes on locally manufactured Virginia-type cigarettes, and burley and native tobacco.

The circular states that five provinces producing Virginia-type cigarettes – Abra, Ilocos Norte, Ilocos Sur, La Union and Misamis Oriental – will be entitled to a share of P14.4 billion.

Meanwhile, 14 provinces that supply barley and native tobacco will get P3.61 billion. These are Abra, Kalinga, Ilocos Norte, Ilocos Sur, La Union, Pangasinan, Cagayan, Isabela, Nueva Vizcaya, Tarlac, Oc­cidental Mindoro, Misamis Oriental, Maguindanao and North Cotabato.

The DBM said the funds shall be chargeable against the 2019 General Appropria­tions Act.

Under Republic Act 7171, LGUs producing Virginia-type cigarettes are entitled to a 15 percent share of national tax collections. Of this amount, 30 percent will be divided among the beneficiary provinces, 40 percent among component cities and municipalities, and 30 percent to the component cities and municipalities.

Republic Act 8240, on the other hand, provides that LGUs producing barley and native tobacco will also receive 15 per­cent from excise tax collections, of which 10 percent will go to beneficiary provinces and 90 percent to the component cities and municipalities