LGRP, backed by the ADB, eyed the LGU’s increase in tax revenue

Can digitization improve the ability of local administrative units (LGUs) to collect taxes? Finance Secretary Carlos G. Dominguez III believes so.

In his opening speech during an online event, Dominguez said the Local Governance Reform Project (LGRP), supported by the Manila-based Asian Development Bank (ADB), will help increase LGU’s revenue as the government does looking for cash in a prolonged economic recession.

Chaired by Dominguez, the Interagency Governing Board (IGB) for the LGRP held its first meeting virtually through Zoom on Tuesday, weeks after the body was officially created after President Duterte signed Administrative Ordinance (AO) 40 on April 27 .

The LGRP will include the introduction of new digital tools by the LGU and the improvement of institutional development as well as political support for real estate appraisal and collection. In collaboration with the ADB, the IGB is also expected to set the guidelines and exercise oversight functions over the project.

Dominguez said the ITUC would focus on: discussing the content of AO 40; Identification of the main results for this year; determine the status of the project; and to decide on the appointment of official representatives of the body.

The Treasury Secretary (DOF) also said the ITUC is playing a leading role in strengthening the country’s local governance framework, ensuring the achievement of key LGRP outcomes within its implementation timeline, and compliance by executive agencies and other stakeholders will monitor.

“At both national and local levels, we need to streamline our revenue generation powers and improve tax administration to raise the funds needed for our Covid-19 response efforts and economic recovery program. Even if we use resources to stimulate the economy, we need to keep building household resilience, ”said Dominguez.

“I trust that everyone in this room is up to the task of helping our local government units deliver efficient, transparent and accountable services to their respective communities. All of these efforts will help fuel our economic recovery and reduce rural poverty, ”he added.

“I assure you to the ADB and the Filipino public that the actions we will take under the ADB will be [LGRP] will be fully functional and irreversible, ”he added.

Under AO 40, the DOF-affiliated Bureau of Local Government Finance (BLGF) will act as the executive agency of the LGRP, with several important government agencies acting as implementing partners. The latter include: the National Economic and Development Agency (Neda); Department of Budget and Administration (DBM); Ministry of Interior and Local Government; Information and Communication Technology Department (DICT); and the Bureau of Internal Revenue (BIR).

The ITUC will have the Finance Secretary of State C. Tionko of the DOF-Revenue Operations Group (ROG) as Vice-Chair.

The ITUC members are composed of: officials from Neda, DILG, DICT, BLGF and BIR; one representative each from the League of Provinces of the Philippines, the League of Cities of the Philippines, and the League of Municipalities of the Philippines; a representative of a non-governmental organization that may be a women’s organization; and a private sector representative.

The loan agreement for the $ 26.53 million project was signed between the government of the Philippines and the ADB last July.

According to the ADB, the LGRP aims to help LGUs improve property tax collection by strengthening property appraisal mechanisms, introducing new digital tools for transparent and accurate reporting, and updating tax cards and property appraisal ratings.

The project will also help LGUs to “build up a cadre of competent, professional local appraisers through capacity development and knowledge partnerships.

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