This paper provides basic information on the taxing authority of the provinces, and its revenue performance in comparison to cities and municipalities. The revenues collected by the provinces act as a barometer to gauge their income-generating capacity.
However, there is a wide disparity in the income-generating capacity of different provinces. The low tax collection in some provinces can be attributed to several factors, including weak capacity to implement and administer local tax codes, obsolete tax assessment and collection systems, outdated valuation, compliance issues, and extensive fiscal exemptions, among others.
Nonetheless, the government’s thrust to increase investment outside Metro Manila, along with strategies and policies on rural development, and the digitization of the tax collection system, which will enable swift transactions and easy retrieval of data for tax payments in provinces, could lead to significant increases in local tax collections.