DOJ Opinion No. 127, s. 1984

DOJ OPINION NO. 127 , s. 1984 August 20, 1984 Mr. Victor C. Macalincag Deputy Minister Ministry of Finance Manila Sir : This has reference to your request for clarification and/or opinion as to the correct "percentage sharing" between the subprovince of Guimaras and the province of Iloilo of the internal revenue allotment accruing to the said subprovince in the light of Section 2142 of the Revised Administrative Code and of Sections 2 and 4 of Republic Act No. 5682. The query arose in view of the difference of opinion between the Commission on Audit (COA) and the Legislative Service of the Office of Budget and Management (BM) given in reply to similar requests presented by that Ministry and Governor Antonio G. Ortiz of the Subprovince of Guimaras. The Presidential Assistant for Legal Affairs of the Office of the President referred this matter to the Minister of Finance for appropriate action pursuant to Section 3 of Presidential Decree No. 477 (Decree on Local Fiscal Administration) and Section 2 of P. D. No. 1375, the last paragraph which states that "The Minister (Secretary) of Finance shall continue to exercise the functions assigned to him under P. D. No. 447 pertaining to local government income, borrowing, other receipts and local treasury operations." (1st Endorsement, January 9, 1984) Said Section 2142 of the Revised Administrative Code reads: "Section 2142. Funds pertaining to subprovince . Seventy per centum of all provincial taxes, fines, or other revenues collected in any subprovince or by reason of any right originating therein shall accrue to the treasury of such subprovince for the sole use and benefit thereof. The remaining thirty per centum of such collections shall accrue to the general fund of the province. Provided, however, That the collections belonging to the road tax of any subprovince shall accrue in their entirety to the treasury of such subprovince. "There shall also accrue to the treasury of a subprovince, for the sole use and benefit of such subprovince, seventy per centum of the internal revenue apportioned to the province in respect to the number of inhabitants contained in the subprovince, except so far as the road funds is concerned, which in accordance with this section shall accrue entirely to the subprovince." Republic Act No. 5682, which is a law specifically applicable to the subprovince of Guimaras, insofar as pertinent, provides as follows: "Section 2. Ninety per centum of all provincial taxes, fines or other revenues collected in the subprovince of Guimaras or by reason of any right originating therein shall accrue to the treasury of said subprovince for the sole use and benefit thereof. The remaining ten per centum of such collections shall accrue to the general fund of the province; Provided; however, That the collections belonging to the road tax shall accrue in their entirety to the treasury of said subprovince." xxx xxx xxx "Section 4. All acts, executive orders and rules and regulations inconsistent with the provisions of this Act are hereby repealed or amended accordingly." The COA in its 9th Indorsement dated 5 May 1983 adopted the view that only the first paragraph of Section 2142, supra , which pertains to the percentage sharing of provincial taxes fines and other revenues between Guimaras Subprovince and the province of Iloilo, has been amended by Section 2 of R.A. No. 5682, that is, by raising the percentage share of Guimaras from 70% to 90%, and that the second paragraph of the same section pertaining to the 70% share of the subprovince and 30% of the province in the internal revenue allotments remains unchanged. On the other hand, the OBM, in its Memorandum dated September 16, 1983 is of the opinion that R.A. No. 5682 superseded the entire Section 2142, so that the second paragraph pertaining to the internal revenue allotments is no longer in force. We agree with the view expressed by the OBM that Section 2 of R.A. No. 5682 (1969) which is a law specifically applicable only to Guimaras Subprovince, has superseded the entire Section 2142 of the Revised Administrative Code, which applies to subprovinces in general, and which was originally incorporated by reference in the basic charter of Guimaras Subprovince (Section 2, R.A. 4667 [Guimaras Charter]). Section 2 of Republic Act No. 5682 is almost a verbatim reenactment of Section 2142 of the Revised Administrative Code, the only changes being in the percentage sharing (from 70%-30%-10%) and the omission of the second paragraph. Such an omission is presumed to be deliberate and by settled rules of statutory construction operates as a repeal of the section that is omitted (Sands, Stat. Const. Vol. 1-A, p. 186). LexLib The computation of national internal revenue allotments to local government units is now governed by the provisions of P.D. No. 144 as amended by P.D. No. 1714 dated October 31, 1980. We are informed by the Bureau of Internal Revenue and the Local Budget Operations Office, OBM that Guimaras Subprovince and the Subprovince of Biliran (which are the only remaining subprovinces to date), have been receiving national internal revenue allotments like a regular province pursuant to the then pertinent provisions of the Internal Revenue Code, and now pursuant to aforesaid Section 3 of P.D. No. 1741. With respect to the second issue raised in the basic papers as to whether the internal revenue allotments of the subprovince of Guimaras should be included in the "administrative percentage" sharing with the province of Iloilo, it is clear both from the language of Section 2142 of the Revised Administrative Code and Section 2 of R.A. No. 5682, above-quoted, that the percentage sharing applies only to "all provincial taxes, fines or other revenues collected in the subprovince" or "by reason of any right originating therein", and not to internal revenue allotments, which are a form of assistance to local government units coming from national taxes or revenues. LibLex Please be guided accordingly. Very truly yours, (SGD.) ESTELITO P. MENDOZA Minister of Justice