Philippines: DBM Releases P3.4B to Tobacco-producing LGUs

Source from:  Manila Bulletin 03/02/2015

The Department of Budget and Management (DBM) has released P3.45 billion to tobacco-producing local government units (LGUs), representing their shares from the revenues generated by the sin tax reform law.

In a statement, Budget and Management Secretary Florencio B. Abad, said the funds released to tobacco producing LGUs came from the government's excise tax collection for the year 2012 alone, but was charged against the 2014 General Appropriations Act (GAA).

Abad said DBM has already released the Special Allotment Release Orders (SAROs) and the Notices of Cash Allocation (NCAs) for the funds.

Once the documentary requirements that are prescribed in Local Budget Memorandum No. 69 (February 18, 2015) are submitted, Abad said downloading of funds to LGUs will proceed.

"The allotment of shares from the excise taxes to tobacco-producing LGUs prove that the taxes Filipinos pay ultimately redound to the benefit of their countrymen," Abad said.

"Tobacco farmers will now have the budgetary support to develop their self-reliance through livelihood and cooperative projects that can help increase their productivity or enhance their income," he added.

LGUs producing burley and native tobacco get a share from 15 percent of the incremental revenue collected from the excise tax on tobacco products under Republic Act (RA) 8240.

Likewise, LGUs producing locally manufactured Virginia-type cigarettes get a share from 15 percent of the excise tax collection on the said cigarettes under RA 7171.

However, Abad clarified that the P3.45-billion release is just a portion of the total tobacco excise tax shares yet to be allocated to the tobacco-producing LGUs. Enditem