MANILA — Local government units (LGUs) are set to receive their biggest-ever share of national taxes, with the National Tax Allotment (NTA) projected to climb to P1.32 trillion in 2027, a P129.32-billion increase from this year’s allocation — a major fiscal boost that President Ferdinand “Bongbong” Marcos Jr. is expected to highlight during his fifth State of the Nation Address (SONA) on July 27.
Executive Secretary Ralph Recto said the increase underscores the Marcos administration’s commitment to empowering provinces, cities, municipalities, and barangays by providing them with a larger share of national revenues.
“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,” Recto said in a statement.
The projected 2027 NTA, which will form one of the largest components of the proposed national budget now being finalized by the Department of Budget and Management, reflects stronger national tax collections.
The 2026 NTA, amounting to P1.19 trillion, was computed based on national internal revenue collections in 2024, in accordance with the law requiring that the allotment be based on tax collections from three years earlier.
Under the allocation formula, the country’s 83 provinces will receive P303.56 billion, 149 cities will get P303.56 billion, 1,491 municipalities will receive P448.84 billion, and 41,912 barangays will share P263.97 billion.
Recto stressed that the distribution of the NTA is strictly governed by law and insulated from political influence.
“That indexation is set in stone, beyond alteration. As such, they are in the nature of automatic appropriations,” he said.
Of the 2026 NTA, around P990.68 billion will come from Bureau of Internal Revenue collections, P329.09 billion from the Bureau of Customs, and P63.6 million from other collections certified by the Bureau of the Treasury.
He added that an LGU’s allocation is determined by factors such as population and land area.
For 2026, Davao City received the largest allocation at P10.1 billion.
Among Metro Manila local government units, Quezon City received P9.82 billion, followed by Manila with P6.09 billion, Caloocan City with P5.5 billion, Taguig City with P4.40 billion, and Pasig City with P3.05 billion.
Apart from the NTA, Recto said the Marcos administration also raised the Local Government Support Fund (LGSF) to a record P57.87 billion for 2026 to strengthen partnerships between the national government and LGUs in carrying out 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,” Recto said.
“In many meetings, he said that treating national government projects as separate from local government projects is a false dichotomy,” he added./PN
