FILIPINOS may not realize that the fiscal relationship between their LGUs and the national government can only be described as grossly unjust. Maybe even that would be an understatement and yet it isn’t really that surprising given the long reliance of a colonial, extractive-oriented, unitary government (colonial masters used to be foreigners and since independence has shifted to Malacañang occupants controlled by the elites) enshrined in our present centralized unitary political system; hopefully, not much longer with the possible shift to federalism as envisioned by and the coming of President Rodrigo R. Duterte.
To fully appreciate this, consider that Malacañang under current tax laws has exclusive rights to over 80 percent of all (national and local) taxes of all sorts while less than 20 percent are within the rights of LGUs to collect and thus in spending, even accounting for Internal Revenue Allotments, the centralized national government accounts for over 80 percent of all (national and local) government spending.
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