Press Release
July 6, 2006


Senate Minority Leader Aquilino Nene Q. Pimentel, Jr. (PDP-Laban) today reminded the national government to comply with its obligation to remit to the local government units (LGUs) their rightful share from taxes and fees collected from companies involved in the utilization of natural resources in their areas of jurisdiction such as mining, logging, energy generation and quarrying.

Pimentel issued the reminder in view of complaints from local government executives reaching his office about the failure of the national government to release to their respective LGUs their legal share from the income generated from the operations of these companies.

I have been receiving complaints from provinces, cities and municipalities that they have not received their dues under the present legislation because the Department of Environment and Department of Finances are dilly-dallying on the release of the share of the LGUs, he said.

Pimentel said it is unfair to withhold these funds from the LGUs especially since they bear the brunt of the pollution and other deleterious effects from the operations of these firms on the environment.

As an example, he cited the operation of the 600-megawatt coal-fired plant in Masinloc, Zambales which the residents have continued to oppose due to emission of toxic fumes that have caused illnesses to human beings and animals and poisoned the air, water and soil.

The operation of the power plant is premised on the fact that the local government of Masinloc will have a share of the government revenues derived from the operation of the plant. Up to now, they havent received any. So thats a cause for alarm, Pimentel said.

The minority leader said it is ironic that Malacañang has made a commitment to the Catholic bishops to take steps to amend the Mining Act to ensure greater protection of the communities from the mining operations. And yet, he said the government is remiss in giving to the LGUs their just share from the taxes paid by mining companies.

Under the Local Government Code (Republic Act 7160), the LGUs are entitled to 40 percent of the gross collection by the national government of mining taxes, royalties and forestry and fisheries charges.

Pimentel has filed Senate Bill 2218 seeking to increase from 40 to 60 percent the share of the LGUs from such revenues.

The sharing scheme also applies to the collection of other taxes, fees or charges, interests or fines, as well as any co-production joint venture or production-sharing agreement in the commercial utilization and development of the national wealth within the territorial jurisdiction of the LGUs.

Under the bill, Pimentel said the share of the LGUs from the utilization of the national wealth shall be remitted by the government agency or corporation concerned within 10 days after the end of every quarter.

This is just one of the measures that seek to broaden the local fiscal resource generation. The intention is to make the local governments self-reliant instead of being dependent on the national government for their funding needs, he said.

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