Iloilo City OKs 100% imposition of realty tax by 2012

ILOILO CITY, Philippines  - Despite opposition from various business groups, the Iloilo City Council the other day unanimously approved in third and final reading the tax ordinance implementing 100 percent of the 2006 schedule of market values on real property tax.

Councilor Perla Zulueta, proponent of the measure, said the new tax rate will take effect on the first day of 2012, after its publication for three consecutive days in newspaper of general circulation in this city.

Those who have concerns against the full implementation of the tax schedule can raise it up to the Tax Assessment Appeals or Secretary of Justice or file a case in court. "In the meantime, while your complaint is being reviewed, the tax takes effect. If you do not pay, you will suffer penalty," Zulueta said.

Zulueta, also chair of the ways and means committee, said the Council listened to the appeal of real property owners to defer the implementation, but then the financial status of the city must be considered most.

The city government is set to lose P77 million next year because of the cut in its internal revenue allotment by P63 million due to the creation of the new 16 cities. A drop of P14 million in tax revenues is also expected because the city's amusement tax was reduced from 30 percent to 10 percent, she said.

The Council, during the three public hearings, had explained to the real property owners and businessmen the city's reason for fully implementing the tax. Presently, the city is only collecting 60 percent of the 2006 schedule of market values because the city "is very generous to the business sector," she said.

Zulueta said the city already waived P163 million by not collecting 100 percent of what it was supposed to collect from real property owners in the city.

The last revision of the Schedule of Base Unit Market Values of Lands and Schedule of Base Unit Construction Cost of Buildings and Other Improvements was in 2006, but it was implemented gradually to mitigate the impact on taxpayers.

In 2006 and 2007, the city just implemented 50 percent of the increase and then 60 percent in 2008 up to the present. This year, with the 60 percent implementation of the schedule, the city has a collectible of over P243.7 million.

This could go up to over P303 million when the city starts the 100 percent implementation of the schedule of values.

Citing the possible impact of paying high taxes, real property owners in the city earlier appealed to the city government to impose the real property tax on gradual basis until it is fully implemented.

In a position paper, the business sector asked the city government if it could collect 75 percent in 2012; 90 percent in 2013, and the full implementation of the schedule of market values only in 2014.

"We feel that we are highly justified. We've been very generous to them already," Zulueta countered.

Councilor Jason Gonzales, vice chair of the ways and means committee, said: "I know it's difficult for big land owners but it is our duty as citizens and it is the city's mandate to implement the tax."  (FREEMAN)