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SECTION 284. Allotment of Internal Revenue Taxes. – Local government units (a) On the first year of the effectivity of this Code, thirty percent (30%); (b) On
shall have a share in the national internal revenue the second year, thirtyfive percent (35%); and (c) On the third year and
taxes based on the collection of the third fiscal year preceding the current fiscal thereafter, forty percent (40%).
year as follows:
22 August 2000 a number of NGOs, along with 3 barangay officials
filed with the SC a petition for Certiorari, Prohibition, and Mandamus 2 Motions to Intervene were filed and granted by the Court to
with Application for Temporary Restraining Order against Exec Province of Batangas and Province of Nueva Ecija.
Secretary Zamora, DBM Sec Diokno, Nat’l Treasurer Magtolis-
Briones, and the COA. This petition challenges the constitutionality of ISSUE/HELD:
the abovementioned provisions of the GAA (particularly sec 1, XXXVII (1) Whether the petition contains proper verifications and
(A) [Allocations to LGUs] and LIV (UNPROGRAMMED FUND) Special certifications against forum shopping
provisions 1 and 4 of the GAA. YES. The present petition cannot be treated as an unsigned pleading.
For even if the rule that representatives of corporate entities must
Petitioners argue that these assailed provisions violate the autonomy present the requisite authorization were to be strictly applied, there
of Local Gov’t by unlawfully reducinn by 10B the IRA due to the LGUs would remain among the multigrouppetitioners the individuals who
and withholding the release of such funds by placing them under validly executed verifications in their own names, namely, petitioners
“Unprogrammed funds”. They claim this violates Art x Sec.6 87 Const2 Adelino C. Lavador, Punong Barangay Isabel Mendez, and Punong
and violates the LGC Secs 18, 284, and 286. Barangay Carolina Romanos.
Although the effectivity of the Year 2000 GAA has ceased, this Court Court cites Shipside Inc v CA: It must also be kept in mind that while
shall nonetheless proceed to resolve the issues raised in the present the requirement of the certificate of nonforum shopping is
case, it being impressed with public interest. Court cited Province of mandatory, nonetheless the requirements must not be interpreted
Batangas v Romulo: “…there is compelling reason for this Court to too literally and thus defeat the objective of preventing the
resolve the substantive issue raised by the instant petition. undesirable practice of forumshopping (Bernardo v. NLRC, 255 SCRA
Supervening events, whether intended or accidental, cannot prevent 108 [1996]). Lastly, technical rules of procedure should be used to
the Court from rendering a decision if there is a grave violation of the promote, not frustrate justice.
Constitution. Even in cases where supervening events had made the
cases moot, the Court did not hesitate to resolve the legal or
constitutional issues raised to formulate controlling principles to (2) Whether petitioners have the requisite standing to file
guide the bench, bar and public otherwise moot and academic if it is this suit. They do have Standing.
"capable of repetition, yet evading review." For the GAAs in the Respondents assail petitioners' standing in this controversy,
coming years may contain provisos similar to those now being sought proffering that it is the local government units – each having a
to be invalidated, and yet, the question may not be decided before separate juridical entity – which stand to be injured. The subsequent
another GAA is enacted” intervention of the provinces of Batangas and Nueva Ecija which have
Court held in favor of the Petitioners they held that: Article X, Section 6 of the Constitution – the same provision relied
upon in Pimentel – enjoins both the legislative and executive
Constitution lays upon the executive the duty to automatically branches of government. Hence, as in Pimentel, under the same
release the just share of local governments in the national taxes, so constitutional provision, the legislative is barred from withholding
it enjoins the legislature not to pass laws that might prevent the the release of the IRA.
executive from performing this duty.
Likewise the Court held that there is merit in the argument of the
intervenor Province of Batangas that, if indeed the framers intended
to allow the enactment of statutes making the release of IRA
ONLY EXCEPTION TO AUTOMATIC RELEASE IS FOUND IN Sec 284 of
the LGC3 by virtue of this provision only possible exception to
mandatory automatic release of the IRA is, as held in Batangas v
Romulo: “...if the national internal revenue collections for the current
fiscal year is less than 40 percent of the collections of the preceding
third fiscal year, in which case what should be automatically released
shall be a proportionate amount of the collections for the current
fiscal year. The adjustment may even be made on a quarterly basis
depending on the actual collections of national internal revenue
taxes for the quarter of the current fiscal year. x x x”
3 Provided, That in the event that the national government incurs an allotment be less than thirty percent (30%) of the collection of national internal
unmanageable public sector deficit, the President of the Philippines is hereby revenue taxes of the third fiscal year preceding the current fiscal year: Provided,
authorized, upon the recommendation of Secretary of Finance, Secretary of further, That in the first year of the effectivity of this Code, the local
Interior and Local Government and Secretary of Budget and Management, and government units shall, in addition to the thirty percent (30%) internal revenue
subject to consultation with the presiding officers of both Houses of Congress allotment which shall include the cost of devolved functions for essential public
and the presidents of the "liga," to make the necessary adjustments in the services, be entitled to receive the amount equivalent to the cost of devolved
internal revenue allotment of local government units but in no case shall the personal services.