MEMORANDUM CIRCULAR NO. 61-A
MEMORANDUM CIRCULAR NO. 61-A -
AMENDING MEMORANDUM CIRCULAR NO. 61
PRESCRIBING THE GUIDELINES FOR THE IMPLEMENTATION OF R. A. NO. 7171
DATED JANUARY 9, 1992
In order to insure the effective
implementation of R.A. 7171, entitled "An Act to Promote the
Development of the Farmers in the Virginia Tobacco-Producing
Provinces", and providing for the share of such beneficiary provinces
equivalent to 15% of the excise taxes on locally manufactured Virginia
type cigarettes, the following guidelines are hereby
promulgated:
1.0
COVERAGE
1.1
This implementing circular shall cover the Department of Budget and
Management, the Bureau of Internal Revenue, the National Tobacco
Administration, and Provinces producing Virginia Tobacco, including the
local government units (municipalities and cities) of each province.
2.0 FUNCTIONAL
RESPONSIBILITIES OF CONCERNED AGENCIES
2.1
The Department of Budget and Management shall:
2.1.1
Include in the Internal Revenue Allotment (IRA) portion of the National
Expenditure Program (NEP) which shall serve as the basis for inclusion
in the annual General Appropriations Act (GAA), an amount equivalent to
15% of the excise taxes on locally manufactured Virginia type
cigarettes based on actual BIR collection for the second calendar year
preceding the year of distribution.
2.1.2 On the
basis of NTA certification, determine the (1) qualified beneficiary
provinces and their respective local government units (municipalities
and cities) by taking into account their average annual Virginia
Tobacco production which should not be less than one million kilos, and
(2) compute the corresponding amount of their respective shares, based
on the adjusted Virginia acceptances.
2.1.3 Taking
into account the cash management and programming procedures, and
budgetary constraints, to issue a funding check directly to the LGUs
(province, cities and municipalities) of beneficiary provinces monthly,
based on the Advice of Allotment released for this purpose.
2.2
The Bureau of Internal Revenue shall:
2.2.1
Collect and set aside the equivalent of 15% of the excise tax
collection on locally manufactured Virginia type cigarettes for the
second calendar year preceding the year of distribution;
2.2.2 Submit
to the DBM for the purpose of budget preparation, a certification as to
the amount set aside not later than April 15 of the current year.
2.3
The National Tobacco Administration shall:
2.3.1
Implement a system for documentation and reporting of Virginia Tobacco
production and Tobacco Acceptances by the Trading Centers in the
Beneficiary provinces, and such other information as may be deemed
necessary for the purpose, viz., total volume of tobacco production per
province, district, cities and municipalities.
2.3.2 Provide
the Department of Budget and Management (DBM) and the Local Government
Units (LGUs) concerned with a certification duly approved by the NTA
Administrator, of Virginia Tobacco production and Virginia Tobacco
acceptances by province, including congressional districts, cities and
municipalities of each beneficiary province, for the immediate past
year, provided, however, that such CERTIFICATION shall be submitted to
the DBM not later than the first quarter of the current year.
2.4
Local Government Units
2.4.1
The Local Government Units (province, municipalities and cities) of
each beneficiary province shall proportionately receive from the
province's share in accordance with 3.3.3.
2.4.2 The LGUs
of the beneficiary provinces shall record separately the receipts and
disbursements of funds in order to account the balance of the funds
released to them.
2.4.3 The LGUs
of the provinces concerned shall ensure that the projects to be
implemented are duly approved by their legislative councils
(Sangguniang Bayan, Panlalawigan, Panlungsod) through an appropriation
ordinance or resolution.
3.0 GUIDELINES
3.1
Basis in the computation of fund equivalent to fifteen (15%) percent.
3.1.1
The fund equivalent to fifteen (15%) percent of the excise taxes on
locally manufactured Virginia type cigarettes shall be computed based
on the actual collections, as certified by the Bureau of Internal
Revenue (BIR), for the second calendar year preceding the year of
distribution (budget year).
3.2
Determination of Qualified Beneficiary Provinces.
3.2.1
The qualified beneficiary provinces shall be determined by DBM based on
their average annual production of not less than one million kilos for
the immediate past two (2) years using as basis the CERTIFICATION duly
approved by the NTA administrator.
3.2.2 The
initial year for purposes of determining the average annual production
shall start in 1991 and onwards.
3.3
Financing and Remittance Scheme, and Utilization and Sharing.
3.3.1
The fund allotted equivalent to the said fifteen (15%) percent shall be
divided on a pro-rata basis among such beneficiary provinces based on
the respective annual volume of adjusted virginia tobacco acceptances
for the immediate past year as certified by the National Tobacco
Administration. For purposes of determining the pro-rata shares, the
immediate past year should be understood to mean two years preceding
the budget year. If year 1994 is the budget year, two years preceding
is year 1992.
3.3.2 The
Department of Budget and Management shall release such share directly
to the LGUs of the provinces concerned on a quarterly basis by way of
issuance of Advice of Allotment and cash allocation by issuing a
funding check on a monthly basis using the certification issued by the
Bureau of Internal Revenue as to the amount of the said excise tax
actually collected and remitted to the Bureau of Treasury, subject to
usual cash programming procedure and budgetary constraint.
3.3.3 The
respective shares of the LGUs of a beneficiary province shall be
distributed as follows:
30%
to the provincial government of the beneficiary province;
40% to the municipalities and
cities to be further distributed as follows: [a] 50% to be divided
equally among all the municipalities and cities of the beneficiary
province, and [b] 50% to be divided according to volume of their
respective tobacco production;
30% to the municipalities and
cities in the congressional districts of a beneficiary province in
consultation with the representatives of the congressional districts of
the province. The share of each congressional district shall be based
on the volume of tobacco production within each district.
PROVIDED,
that, 50% of all the shares accruing to the Local Government units are
used for barangay economic development projects.
3.3.4
The respective shares of the LGUs of beneficiary provinces shall be
treated as a special account under the general fund of the LGUs of
provinces to be utilized for the following projects:
3.3.4.1
Cooperative projects that will enhance better quality of products,
increase productivity, guarantee the market and as a whole increase
farmer's income;
3.3.4.2
Livelihood projects particularly the development of alternative farming
systems to enhance farmers' income;
3.3.4.3
Agro-industrial projects that will enable tobacco farmers in the
Virginia tobacco-producing provinces to be involved in the management
and subsequent ownership of these projects such as post-harvest and
secondary processing like cigarette manufacturing and by-product
utilization; and
3.3.4.4
Infrastructure projects such as farm-to-market roads.
4.0 This
Circular shall take effect immediately.
Manila, November 28, 1993.
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