Villarete clarifies hiking of fair market values

Cebu City Planning and Development officer Nigel Paul Villarete said implementation of City Tax Ordinance No. 99 next year does not necessarily imply a 30 percent across the board increase in the fair market values of real properties but a projected 30 percent increase instead in the revenues from realty tax next year.

As of November this year, City Treasurer Tessie Camarillo said the city was able to collect P433.9 million in realty taxes.

Villarete, who was then the city administrator and the chairman of the local finance committee when the said proposed tax measure was endorsed to the city council for approval in 2002, yesterday clarified that the implementation of City Tax Ordinance No. 99 implies some real property owners might experience an increase of 30 percent in their tax dues, while still some will have to pay less or even experience no increase at all in their realty tax dues.

"In 2002 revision, about 80 percent will not experience any increase because about 50 percent of the landowners are exempted anyway," Villarete said.

This as the 1991 Local Government Code provides that buildings and structures located in residential areas which have a fair market value of not more than P175,000 shall have a zero percent assessment level.

Villarete explained the real purpose and intention in the implementation of the revised schedule of the fair market values of real properties is not only to generate more revenues because it is "inherent" but more importantly to equalize taxes across development in the city.

For instance, valuation of properties located in Magallanes, Colon and Sanciangko streets used to be at P5,000 per square meter but it slightly increased to P10,000 per square meter in 2000 while properties in the new site of Ma. Luisa Subdivision in barangay Banilad used to be assessed at P50 per square meter but it dramatically went up to P40,000 per square meter in 2000 because of the development there.

"In the 80 barangays in the city, there are so many sub-districts and in the city there are many zones, each one of which will have to be revised in accordance with the trends and developments," Villarete said.

He further emphasized they are now avoiding the implementation of a flat rate just like what the previous administration did for the years 1996 and 1999 wherein a 10 percent across the board increase plus a one year moratorium on tax dues for real properties was implemented.

On the other hand, local assessment operation officer Hilario Alicante Jr., who helped prepare the schedule of fair market values in 2002, presented to reporters yesterday a document showing that current assessment levels or rates applied to the fair market value of real properties in the city are way below the ceiling provided for in the Local Government Code.

Under the new schedule, a total average of a total 74 percent increase shall be implemented within the three-year period of the implementation.

The revised schedule of fair market values has since been contained in City Tax Ordinance No. XCIX or "An Ordinance Amending City tax Ordinance No. LXX, otherwise known as The Real Property Tax Code of the City of Cebu, adopted on October 2, 2002.

The said ordinance is in compliance to a provision of the local government code which stipulates that general revisions of the scheduled market value of real properties shall be done once every three years.

This will serve as basis for the classification, appraisal, and assessments of all residential, commercial, and industrial lands within the territorial jurisdiction of Cebu City.

The general revision on realty tax was initially implemented in 2003 but this was stopped after the city council passed an amendatory ordinance stipulating deferment of its implementation to January 1, 2004 and was further deferred to January 1, 2005.

The deferment was then in view of the clamor of the businessmen, taxpayers, real estate agents and builders who found the adjustments as "excessive." - Cristina C. Birondo