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Marco Luis Beech - The Philippine Star
December 29, 2025 | 12:00am
Stock photo of a peso money bill.
Philstar.com / Jovannie Lambayan, file
MANILA, Philippines — Local government units (LGUs) are set to receive P1.19 trillion in 2026 from their share of national taxes, providing a major boost to local budgets and enabling increased spending on public services and development programs nationwide.
In a local budget memorandum, the Department of Budget and Management (DBM) formally released the final allocations for the national tax allotment (NTA) for fiscal year 2026, covering more than 43,500 LGUs.
A total of 41,913 barangays nationwide are set to receive P238.1 billion in tax shares next year, while 83 provinces are slated to get P273.82 billion and 149 cities are projected to receive P274.1 billion.
Meanwhile, 1,491 municipalities nationwide are earmarked to receive the largest share of the allocation, amounting to P404.49 billion.
The tax share of LGUs is in accordance with the Local Government Code, which provides a 34-percent share of the NTA to municipalities, 23 percent for provinces and cities and 20 percent for barangays.
Following its 2022 Mandanas ruling, the Supreme Court ordered that LGUs’ tax share be set at 40 percent of all national taxes – not just collections by the Bureau of Internal Revenue – significantly expanding the LGUs’ revenue base.
Region 4-A, which encompasses the provinces of Cavite, Laguna, Batangas, Rizal and Quezon, is slated to receive the largest allocation at P142.28 billion, reflecting the region’s huge population base. Central Luzon (Region III) is next with allocation reaching P116.84 billion followed by the National Capital Region at P71.69 billion.
The Cordillera Administrative Region is set to receive the lowest tax share at P35.37 billion.
The NTA for the coming year is projected to be 15 percent higher than the current year’s level of P1.03 trillion, marking a notable increase in funds available to LGUs for local projects and development projects.
