RA 7160 — The Local Government Code

By Landon Little, Founder of Zentarai Labs · Updated October 8, 2026

The Local Government Code of 1991 (Republic Act 7160) was signed on October 10, 1991 and took effect January 1, 1992. It replaced a patchwork of earlier local-government statutes and gave provinces, cities, municipalities, and barangays a single, unified charter: their own taxing powers, their own legislative councils, and — as declared state policy under Section 2 — "genuine and meaningful local autonomy." Everything an LGU does with its own budget, its own zoning map, or its own ordinances traces back to authority this law grants.

How the Code is organized

RA 7160 runs to 536 sections in four Books. The ranges below follow the text of the Code as approved in 1991.

• Book I, General Provisions (Sections 1 to 127). Basic principles, including the declaration of policy (Section 2), the general welfare clause (Section 16), basic services (Section 17) and reclassification of land (Section 20); elective officials; human resources and development; local school boards, local health boards and local development councils; the local peace and order council; autonomous special economic zones; and other provisions that apply to all LGUs.
• Book II, Local Taxation and Fiscal Matters (Sections 128 to 383). Local government taxation, real property taxation (from Section 197), the shares of LGUs in national taxes (from Section 284), credit financing (from Section 295) and local fiscal administration (from Section 304).
• Book III, Local Government Units (Sections 384 to 510). One Title each for the barangay (from Section 384), the municipality (440), the city (448) and the province (459), setting out each level's officials, its chief executive and its sanggunian; then appointed officials common to municipalities, cities and provinces (469), and the leagues of LGUs and elective officials (491).
• Book IV, Miscellaneous and Final Provisions (Sections 511 to 536). Penal provisions, provisions for implementation, transitory provisions (including the rule-making mandate in Section 533) and the final provisions: the repealing clause (Section 534) and the effectivity clause (Section 536).

Sections people look up most

Headings are as printed in the Code. Section 284 is shown with its 1991 heading; the Supreme Court has since struck the words "internal revenue" from it (see later changes).

What RA 7160 actually devolved

Before 1991, most of what a city or municipality does today — basic health services, agricultural extension, social welfare, environmental enforcement, and land use planning — sat with national line agencies. RA 7160 transferred the functions, the personnel, and (in principle) the funding for those services down to the LGU level. The three levels it governs:

• Provinces — coordinate component cities and municipalities, run province-wide services (some hospitals, some infrastructure).
• Cities and municipalities — the primary service-delivery unit; highly urbanized cities (HUCs) and independent component cities operate outside provincial supervision.
• Barangays — the smallest unit, with their own council (Sangguniang Barangay) and basic dispute-resolution and administrative functions.

The CLUP mandate: Sections 20, 447, and 458

RA 7160 is the legal root of every Comprehensive Land Use Plan (CLUP) in the country. Section 20 governs how an LGU may reclassify agricultural land to other uses, and Section 20(c) makes CLUPs enacted through zoning ordinances the primary and dominant bases for the future use of land resources. Sections 447 (municipalities) and 458 (cities) give the sanggunian the power to adopt the CLUP, reclassify land and enact an integrated zoning ordinance consistent with the plan. Provinces have a different role: under Section 468, the sangguniang panlalawigan reviews the CLUPs and zoning ordinances of its component cities and municipalities and adopts a provincial land use plan. RA 7160 grants the authority to plan; it does not itself set the CLUP's technical review process — that sits with the Department of Human Settlements and Urban Development (DHSUD) under RA 11201 and the two-track ratification structure in Executive Order 72 (s. 1993).

Local taxation and the National Tax Allotment

RA 7160 gives every LGU its own revenue powers under Book II: real property tax, local business taxes, and a range of local fees. On top of that, LGUs receive a mandatory share of national government tax collections — historically the Internal Revenue Allotment (IRA). Following the Supreme Court's 2018 Mandanas-Garcia ruling (G.R. Nos. 199802 and 208488), that share was recalculated to draw from a broader base of national taxes rather than internal revenue collections alone, and is now generally called the National Tax Allotment (NTA), effective fiscal year 2022 onward. This is the funding base LGUs draw on for the 20% Development Fund and Local Development Investment Program (LDIP) — the same investment program the SGLG Incentive Fund is meant to support.

Implementing rules and later changes

• Implementing Rules and Regulations (1992). Section 533 set up an Oversight Committee to draft the rules. They were issued through Administrative Order No. 270, signed February 21, 1992, which prescribes the Implementing Rules and Regulations of the Local Government Code of 1991.
• The Mandanas ruling (2018). In Mandanas v. Ochoa (G.R. Nos. 199802 and 208488, July 3, 2018), the Supreme Court declared the phrase "internal revenue" in Section 284 unconstitutional and deleted it, so the LGU share is computed on national taxes rather than national internal revenue taxes alone.
• Full devolution (2021). Executive Order No. 138, dated June 1, 2021, orders the functions listed in Section 17 of RA 7160, and those devolved by later laws, to be fully devolved to LGUs no later than the end of FY 2024. It ties the move to the larger LGU shares expected from FY 2022 under the Mandanas ruling.

How this differs from RA 12254 and RA 11201

These three statutes get confused often enough that it's worth stating plainly:

• RA 7160 (1991) — the Local Government Code. General LGU powers, structure, taxation, and the authority to plan and zone land.
• RA 11201 (2019) — the DHSUD Act. Created the Department of Human Settlements and Urban Development, today's national CLUP and zoning regulator (successor to HLURB).
• RA 12254 (2025) — the E-Governance Act. A digital-government-services statute (DICT-led, Section 9's eLGU mandate) with no land-use content at all. See the RA 12254 explainer for the full contrast.

Frequently asked questions

What is RA 7160?

Republic Act 7160, the Local Government Code of 1991, is the Philippines' foundational statute for local governance. Signed October 10, 1991 and effective January 1, 1992, it devolved powers, functions, and resources from national agencies to provinces, cities, municipalities, and barangays.

What does RA 7160 have to do with land use planning?

Section 20(c) makes comprehensive land use plans enacted through zoning ordinances the primary and dominant bases for the future use of land resources. Sections 447 and 458 give municipal and city sanggunians the power to adopt the CLUP, reclassify land and enact an integrated zoning ordinance consistent with the plan. Section 468 gives the provincial sanggunian a different role: it reviews the CLUPs and zoning ordinances of its component cities and municipalities and adopts a provincial land use plan. The CLUP itself is prepared and reviewed under Executive Order 72 (s. 1993) and the DHSUD guidelines issued under RA 11201.

What is Section 458 of RA 7160?

Section 458 sets out the powers, duties, functions and compensation of the sangguniang panlungsod, the city council. Section 458(a)(2)(vii) to (ix) let it adopt a comprehensive land use plan for the city, reclassify land within the city, and enact integrated zoning ordinances consistent with the approved plan. A component city must coordinate its plan with the approved provincial land use plan. Section 447 gives the sangguniang bayan of a municipality the same land-use powers.

What does Section 20 of RA 7160 say?

Section 20 lets a city or municipality reclassify agricultural land by ordinance, after public hearings, when the land is no longer economically feasible for agriculture (as determined by the Department of Agriculture) or has substantially greater economic value for residential, commercial or industrial use (as determined by the sanggunian). Reclassification is capped at 15% of agricultural land for highly urbanized and independent component cities, 10% for component cities and first to third class municipalities, and 5% for fourth to sixth class municipalities; the President may allow more on the recommendation of NEDA. Land distributed under agrarian reform (RA 6657) is not affected. Section 20(c) makes CLUPs enacted through zoning ordinances the primary and dominant bases for the future use of land resources.

Does RA 7160 have implementing rules (IRR)?

Yes. Section 533 of the Code set up an Oversight Committee to draft them, and they were issued through Administrative Order No. 270, signed February 21, 1992, which prescribes the Implementing Rules and Regulations of the Local Government Code of 1991.

Is RA 7160 the same as RA 12254?

No. RA 7160 (1991) is the Local Government Code and covers land use, local taxation, and the general powers of LGUs. RA 12254, the E-Governance Act, is a separate 2025 statute about digital government service delivery (see novagov.ph/ra-12254). It does not amend or replace any RA 7160 provision on land use.

How does RA 7160 fund local governments?

RA 7160 gives LGUs their own taxing powers under Book II (local taxes and fees in Title I, real property tax in Title II) and a share of national taxes under Title III. Section 284 set that share at 40% from the third year of the Code onward, and Section 285 splits it 23% to provinces, 23% to cities, 34% to municipalities and 20% to barangays. The share was long called the Internal Revenue Allotment (IRA). In Mandanas v. Ochoa (2018) the Supreme Court struck the words "internal revenue" from Section 284, so the base is national taxes rather than internal revenue taxes alone. The larger shares apply from FY 2022, and the allotment is now generally called the National Tax Allotment (NTA).

What are the three levels of local government under RA 7160?

Provinces, cities and municipalities, and barangays. Cities and municipalities operate within a province except for highly urbanized cities (HUCs) and independent component cities, which are administratively independent of the province. Each level has its own sanggunian (legislative council) and executive.

Sources

• Republic Act No. 7160, the Local Government Code of 1991, full text: lawphil.net
• Administrative Order No. 270 (February 21, 1992), Implementing Rules and Regulations: lawphil.net
• Mandanas v. Ochoa, G.R. Nos. 199802 and 208488 (July 3, 2018): lawphil.net
• Executive Order No. 138 (June 1, 2021), full devolution: lawphil.net

Section numbers, headings and quoted text were checked against the Lawphil text of RA 7160 on October 8, 2026. Lawphil notes later amendments to some sections (for example, Sections 41(b) and 43 by RA 8553), so check the current text before relying on a specific provision.

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