32 transfers are mostly used to cover public welfare

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Unformatted text preview: Only twenty percent of the annual internal revenue is used for development projects as mandated in the LGC. 3.6 Conclusions The assessment of revenue generation over the years since decentralization shows poor performnace in the generation of revenue of the City. The City receives only 8 percent of its total revenue from taxes, and its public enterprise accounts run regular deficits. The analysis clearly shows that the city is unlikely to continue providing services without being extremely dependent on the central government and its agencies. Under declining IRA and stagnant growth of real income from taxes and other sources, service delivery in Olongapo could be severely hampered. A number of additional functions devolved to Olongapo Local Government under the 1991 LGC do not have direct cost recovery mechanisms and are solely dependent on tax revenues. The analysis reveals that local tax revenue has clearly failed to keep pace with new responsibilities. Moreover, the center can only provide limited assistance through intergovernmental transfers. Increasing...
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