IN 2022, the Internal Revenue Allotment (IRA) for local government units will increase by about P225 billion, thanks to a July 2018 Supreme Court ruling that corrected a persistent, intentional misinterpretation of the IRA law by every administration since the implementation of the Local Government Code in 1992. While this is mostly good news, there is still a considerable risk that both the national government and local government units (LGUs) could make a complete mess of it. That is why, according to a study by the Philippine Institute for Development Studies (PIDS) presented late last month, government at all levels should be preparing even this early to ensure a smooth transition.

First, a bit of background: The Supreme Court in July 2018 ruled in favor of two petitions challenging the national government’s computation of the IRA; one petition was filed by a group led by Batangas Gov. Hermilando Mandanas while the other was filed by the late Bataan representative Enrique Garcia Jr.