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The seat of the Supreme Court of the Philippines in Manila.
Philstar.com / EC Toledo
MANILA, Philippines — Batangas Vice Gov. Hermilando Mandanas and the Philippine Councilors League (PCL) on Tuesday, March 3, asked the Supreme Court to mandate the automatic remittance of tax shares legally owed to local government units (LGUs).
In a petition filed on March 3, Mandanas and the other petitioners asked the high court to enforce and clarify the automatic release of the national tax allocation (NTA) to LGUs.
The petition arose from a reported P155.9 billion shortfall in the 2026 tax shares for LGUs.
According to the petitioners, because Congress failed to pass the 2026 General Appropriations Act (GAA) on time, the 2025 budget was reenacted by operation of law.
As a result, the national government computed the 2026 NTA based on the reenacted 2025 figures of approximately P1.034 trillion, rather than more than P1.190 trillion originally projected for the 2026 fiscal year.
The core of the controversy centers on a P155.9 billion shortfall in the 2026 tax shares for LGUs.
The petition also named officials including Executive Secretary Ralph Recto, Finance Secretary Frederick Go and Acting Budget Secretary Rolando Toledo, alleging that they committed grave abuse of discretion by treating the NTA as a discretionary item within the GAA, making it subject to presidential vetoes and legislative delays.
The petitioners argue that this practice violates the constitutional mandate that LGUs’ rightful share of national taxes must be automatically released.
Citing the previous Mandanas-Garcia Supreme Court ruling, the petitioners maintain that including the NTA in the annual GAA is “unnecessary, if not superfluous.”
They argue that once the tax share is collected and computed, its release should be a “purely ministerial and mechanical act” that does not require further executive approval or legislative authorization.
“Precisely because the inclusion of the LGUs just share in the General Appropriations Act is unnecessary, no constitutional or statutory purpose is served by including the computation of such share therein,” the petition read.
“The computation does not derive its authority from the GAA, nor does the GAA add any legal force to the amount so computed. On the contrary, embedding the computation in the GAA merely subjects the LUs' share to risks and contingencies, such as constitutional reenactment or presidential veto, which the Constitution expressly sought to avoid by mandating automatic release,” it added.
