CAN digitalization enhance the ability of local government units (LGUs) to collect taxes? Finance Secretary Carlos G. Dominguez III believes so.
In his opening remarks during an online event, Dominguez said the Local Governance Reform Project (LGRP) supported by Manila-based Asian Development Bank (ADB) will help boost LGUs’ revenue collection as government scrambles for cash amid a lingering economic recession.
Chaired by Dominguez, the Interagency Governing Board (IGB) for the LGRP held its first meeting virtually via Zoom on Tuesday, weeks after the body was formally created following President Duterte’s signing of Administrative Order (AO) 40 last April 27.
The LGRP will entail LGU’s adoption of new digital tools and improvement of institutional development and policy support for property valuation and collection. In partnership with the ADB, the IGB is also expected to provide policy direction and exercise oversight functions over the project.
Dominguez said the IGB will focus on the following: discuss the contents of AO 40; identify key deliverables for this year; determine the status of the project; and, decide on the appointment of official representatives to the body.
The secretary of the Department of Finance (DOF) also said the IGB will play a lead role in strengthening the country’s local governance framework, ensure the attainment of the LGRP’s major outputs within its implementation timetable and monitor the compliance of executing agencies and other stakeholders.
“At both national and local levels, we need to optimize our revenue generation powers and improve tax administration to raise necessary funds for our Covid-19 response efforts and economic recovery program. Even as we stretch resources to stimulate the economy, we must continuously build up our fiscal resilience,” Dominguez said.
“I trust that everyone in this room will be up to the task of assisting our local government units in providing efficient, transparent, and accountable services in their respective communities. All these efforts will help boost our economic recovery and reduce poverty in the countryside,” he added.
“To the ADB and the Philippine public, I assure you that the measures that we will be undertaking through the [LGRP] will be fully functional and irreversible,” he added.
Under AO 40, the DOF-attached Bureau of Local Government Finance (BLGF) will serve as the executing agency of the LGRP, with several key government agencies as implementing partners. The latter include the following: the National Economic and Development Authority (Neda); Department of Budget and Management (DBM); Department of Interior and Local Government; Department of Information and Communications Technology (DICT); and, the Bureau of Internal Revenue (BIR).
The IGB will have Finance Undersecretary C. Tionko of the DOF-Revenue Operations Group (ROG) as alternate chairperman.
The IGB members are composed of the following: officials from the Neda, DILG, DICT, BLGF and BIR; one representative each from the League of Provinces of the Philippines, League of Cities of the Philippines and League of Municipalities of the Philippines; a representative from a non-government organization, which may be a women’s organization; and, a representative from the private sector.
The loan agreement for the $26.53-million project was signed between the Government of the Philippines and the ADB in July last year.
According to the ADB, the LGRP aims to help LGUs improve real property tax collection by strengthening property valuation mechanisms, introducing new digital tools for transparent and accurate reporting and updating tax maps and property valuation assessments.
The project will also help LGUs build “a cadre of competent, professional local assessors through capacity development and knowledge partnerships.