The IRA cut is due to the conversion last year of 17 municipalities to component cities, across the country.
The IRA allotted for the cities this year is P210 billion. But the creation of new cities has resulted in minimal increases in the IRA of older ones so that Kidapawan, instead of getting an increase of P42 million would only receive some P5 million as a result of the conversion, a cut of P37 million.
But the new revenue code which is projected to earn between 10 and 20 million pesos this year, has met strong opposition from the business sector.
But the mayor defended the implementation of the new revenue code saying the IRA cut has hampered the implementation of infrastructure projects and delivery of basic social services.
The city government, however, assured that it will impose austerity measures to ensure delivery of basic services despite the cut.
Late last year, the Department of Budget and Management gave the League of Cities in the Philippines and its 120-member cities notices of the IRA cut.
Mayor Rodolfo Gantuangco meanwhile has joined the league’s campaign to address the IRA cut.
The league has filed a motion for injunction before the Supreme Court to stop the DBM from releasing the additional IRA to the newly created cities.
Gantuangco said that anytime this month the league will meet with the President to discuss the possible impact of the IRA cut on its member cities. (MindaNews)