PART IV: DEVELOPMENT ADMINISTRATION

Agency	CY 2007	CY 2008	Inc./Dec
BFP	7.05	22.42	15.37
BIR	5.64	12.83	7.19
BJMP	3.59	5.19	1.60
BLGF	0.40	0.12	(0.28)
BU	158.01	170.16	12.15
Bureau of Customs	-	5.10	5.10
Bureau of Treasury	1.00	-	(1.00)
CDA	0.44	1.00	0.56
CNSC	2.01	3.01	1.00
Cat SC	2.01	13.01	11.00
CSPC	2.01	3.01	1.00
CSSAC	2.01	38.01	36.00
DA	-	15.47	15.47
DBM	-	0.54	0.54
DEBESMSCAT	2.01	3.01	1.00
DENR	21.28	167.13	145.85
DILG	0.10	0.20	0.10
DOH	65.00	27.00	(38.00)
DOT	29.50	-	(29.50)
DOTC	472.35	482.88	10.53
DPWH	1910.55	2983.00	1072.45
DSWD	17.00	-	(17.00)
DTI	1.65	-	(1.65)
EMB	10.00	1.00	(9.00)
FIDA	-	0.12	0.12
NCIP	-	20.00	20.00
NHMFC	-	62.50	62.50
NIA	-	50.00	50.00
PSU	7.01	12.01	5.00
SSC	2.01	3.01	1.00
TESDA	10.30	6.10	(4.20)
TOTAL	2732.93	4107.83	1374.90

                        Sources: GAA 2007 and GAA 2008

Expenditure	CY 2006	CY 2008	Inc/Dec
General Public Services	3757.32	4388.14	631.82
Education, Culture, and Sports/Manpower Development	208.24	226.38	18.14
Health, Nutrition, and Population Control	1045.09	1226.83	181.74
Labor and Employment	10.83	8.14	(2.69)
Housing and Community Development	53.83	47.21	(6.62)
Social Security/Social Services and Welfare	208.13	319.74	111.61
Economic Services	1508.33	1764.80	256.47
Debt Service	217.73	361.30	143.57
Other Purposes	2358.06	2323.86	(34.20)
TOTAL	9367.56	10666.40	1298.84

                       Source: BLGF 5

   Other purposes was allocated some PhP2.32 billion.  This was followed by economic services with PhP1.76 billion, and health, nutrition and population control with PhP1.23 billion.  Compared to 2006 expenditures, the 2008 expenses was PhP1.30 billion higher.  Most of the expense items increased except for labor and employment, housing and community development, and other purposes.

        

   On the strategy to tap other fund sources, several programs and projects were financed partly through foreign funds in the form of loans or entirely through grants.  Among the foreign assisted projects funded by loans were the Second Agrarian Reform Communities Development Project (ARCDP 2 –WB), the Infrastructure for Rural Productivity Enhancement Sector Project (InFRES - ADB) and the Rural Road Network Development Project (RRNDP – JBICO).

 

   Grant assisted projects from the Spanish government through its international aid agency (AECID) were Poder y Prosperidad de la Comunidad (DSWD), Sustainable Management of Coastal Resources (SUMACORE - BFAR), Strengthening Agro-Industrial Sector for Bicol and Caraga (SAISBC - DA), Agriculture, Social Support and Environment Facility (ASSEF - NEDA), Improvement of the Quality of Education (IQPE - DepEd), and Strengthening Local Governments in the Philippines (SLGP - DILG). Another grant funded project was Restoring Food Security in Typhoon Affected Areas funded by FAO and implemented by DA.

 

   International NGOs operating in Bicol which provided a wide range of economic and social projects included Manos Unidos, Accion Contra el Hambre, Intervida, Fundacion CODESPA, IPADE, Cruz Roja Espanola, Humanismo y Democracia and Plan International. 

 

   Some local government units financed their projects through borrowings, bond flotation or through the build, operate and transfer (BOT) scheme.

 

   Other identified projects like large scale mining were financed through the private sector with capital infusion from foreign firms.

 

 Tax Collection

 

   Tax is the major source of government revenue that finances the implementation of programs and projects. The Bureau of Internal Revenue (BIR) handles tax collection in the country.

 

   Actual tax collection in CY 2008 increased by 1.64 percent (Table 30.3) compared in CY 2007. However, tax collection compared to the target was short by 13 percent.  Among the region’s revenue districts, only Virac met its target with the highest collection efficiency of 121 percent. All others were not able to meet their respective targets. Decrease in collection was felt in Iriga City, Legazpi City, Virac and Masbate City.  

 

   The identified factors that contributed to the decline in collection were the implementation of the exemption of minimum wage earners from taxation and the increase of personal and additional exemption under RA 9504, completion of the projects funded from calamity fund that reduced the collection of contractors’ taxes, very high goal allocation set for the region, change in the venue where tax remittance advice were paid and closure of some business establishments.

Table 30.3 Comparative Tax Collection by Revenue District,

Bicol Region, CY 2007 - 2008 (In Million Pesos)

Revenue District Office	Actual 2007	Target 2008	Actual 2008	2008 Collection Efficiency  (in %)	(2008 vs. 2007) Percent Change
Daet	353.915	442.450	439.733	99.39	24.25
Naga City	863.177	1124.764	926.212	82.35	7.30
Iriga City	232.981	294.003	222.340	75.63	(4.57)
Legazpi City	1548.482	1699.899	1507.810	88.70	(2.63)
Sorsogon City	319.496	397.906	336.644	84.60	5.37
Virac	234.423	176.915	213.870	120.89	(8.77)
Masbate City	269.476	351.362	237.903	67.71	(11.72)
Total	3821.951	4487.299	3884.512	86.57	1.64

                        Source:  BIR District 10

   By tax type, income tax and value added tax accounted almost 90 percent of the total tax collection. In terms of collection efficiency, targets for   income, value added and percentage taxes were met.  Income tax collection for CY 2008 fell short by five percent. Value added tax collection was 18 percent lower than the target.  A comparison with the 2007 collections showed that income tax and value added tax fell by 0.88 percent and 1.5 percent, respectively (Table 30.4).

Table 30.4 Comparative Internal Revenue Tax Collection by Tax Type,

Bicol Region,  CY 2007 – 2008 (In Million Pesos)

Type of Tax	Actual 2007	Target 2008	Actual 2008	2008 Collection Efficiency (in %)	(2008 vs. 2007) percent Change
Income	2224.750	2327.645	2205.213	94.74	(0.88)
Value Added	1273.119	1751.009	1253.521	71.59	(1.54)
Percentage	154.514	178.823	175.176	97.96	13.75
Others	143.804	223.414	243.311	108.91	69.20
Excise	25.764	6.408	7.290	113.76	(71.70)
Total	3821.951	4487.299	3884.512	86.57	1.64

                       Source:  BIR District 10

Type of Collection	Actual 2007	Target 2008	Actual 2008	2008 Collection Efficiency (in %)	(2008 vs. 2007) Percent Increase
Cash	36.873	40.000	58.311	145.78	58.14
Non-Cash	1018.925	-	2768.943	-	171.75
Total	1055.798	-	2827.254	-	167.78

                        Source: BOC 5

   The non-cash income of the Bureau of Customs was obtained from the National Food Authority (NFA) rice importation under the deferred payment scheme. The duties for the rice importation were paid in the ensuing year from their appropriations.

 

 Local Government Income

 

   Local government units (LGUs) had a total income of PhP12.24 billion in CY 2008 (Table 30.6). Of this amount, 81.5 percent came from internal revenue allotment (IRA). Local tax sources amounted to PhP1.634 billion while loans and borrowings amounted to PhP450 million.  Compared to the CY 2006 LGU income, the CY 2008 was higher by PhP1.84 billion. The data showed that LGUs still rely on the national government for their operations.  Local tax generation increased as a result of improved collection system, tax mapping activities and intensive tax information, and collection drives.    

Table 30.6 Income of Local Government Units, Bicol Region,

CY2006 and CY2008 (In Million Pesos)

Particulars	CY 2006	CY2008	Inc/Dec
Local
Tax	675.03	825.47	150.44
Non-Tax	603.25	808.77	205.52
Share from National Taxes
IRA	8608.01	9979.28	1371.27
Others	58.54	117.18	58.64
Extraordinary Receipts	174.17	62.52	(111.65)
Loans and Borrowings	277.11	449.89	172.78
Inter-Local Transfers	5.20	0.34	(4.86)
TOTAL	10401.31	12243.45	1842.14

                       Source: BLGF 5