Higher realty assessment to result in bigger tax collection

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Thursday, March 13, 2014

THE Cebu City Assessor’s Office seeks to raise the assessed value of real property units (RPU) in the city this year so the City Government can collect bigger taxes.

City Assessor OIC Atty. Ferdinand Cañete yesterday said they are targeting to raise the assessed value of RPUs to P35 billion from P28 billion last year.

This way, the City can collect P1.050 billion worth of tax dues, which is bigger than the P840 million in 2013. The amount represents the three-percent real property tax.


“If daghang kwarta (If the City has a lot of money), then daghan ang mabalik sa (it will be a windfall for) constituents in terms of programs and projects,” he said.

Bigger SEF

An increase in the collection of real property tax also means there will be an increase in the Special Education Fund (SEF).

Of the three-percent realty property tax, one percent is set aside for the SEF, which is used for the operation and maintenance of public schools, among others.

So they can meet the P35-billion target for 2014, Cañete said they are proposing to continue their tax mapping program, especially on RPUs located in the mountain villages.

Tax mapping is when personnel of the assessor’s office and the City Treasurer’s Office checks each barangays’ RPU and asses the appropriate tax to be paid to the City Government.

Aside from that, Cañete said they also are planning to revise the tax assessment levels of RPUs.

At present, the tax assessment level for residential properties is two percent and 10 percent for commercial lots and industrial, mineral and timberland properties.
Agricultural properties, on the other hand, are imposed a 4.5-percent tax.

For residential properties, Cañete said they want to increase it to 4.5 percent, 8.5
percent for agricultural properties and 20 percent for commercial, industrial, mineral and timberland properties.

Cañete said there’s a need to revise the tax assessment levels of RPUs, considering that City Hall last revised its tax assessment in 2006 yet. (Republic Act 7160, or the Local Government Code, provides that the process is supposed to be done every three years.)

There have been proposals in the past, but Cañete said the council did not approve the proposed ordinance covering the matter because it was afraid of the public backlash.

Another program that the assessor’s office wants to implement this year, Cañete said, is the imposition of an additional 15-percent tax on lots located on street corners.

Mayor’s decision

Cañete said the matter is already covered under a 1994 city ordinance, but has yet to be implemented.

He also proposes to require the declaration of machinery for five-story buildings and up so these can be taxed properly. He also wants to impose an additional five-percent
tax on idle lands.

“The purpose of taxing the idle land is to encourage owners to produce economic activity on his or her property. If there will be economic activity, then it will generate employment and we can collect business tax,” he said.

Cañete said they plan to implement more activities so they can meet their P35-billion target.

He said they will submit their proposal to Mayor Michael Rama for his comment or approval.

In previous interviews, though, the mayor opposed any increase on taxes. He said there is a need for the City to be sensitive to real property owners.

The mayor said the matter is easier said than done.

Published in the Sun.Star Cebu newspaper on March 14, 2014.

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