CEBU, Philippines - Most local government units in Cebu and Central Visayas are inefficient real property tax collectors, according to the Bureau of Local Government Finance.
BLGF-7 assistant regional director Herminigilda Garsula said, while the real property taxes is considered the most important revenue base, most LGUs have failed to use its taxing power.
Garsula said BLGF statistics show that last year’s business taxes collections of various LGUs in the region is much bigger than the real property taxes.
In Naga City for example, only P31.9 million or 67 percent of the P47.4 million assigned target was collected. Talisay City also fell short of its target in real property taxes having collected only P51.4 million against its P58.4 million target.
All LGUs in Central Visayas only collected a total of P1.376 billion in 2009 an amount lesser by P469.9 million compared to the P1.846 billion overall business taxes collected for the same period.
Real property taxes are derived from payments of land owners, buildings and machineries.
Garsula explained that the increase of the income of the LGUs depends on their willingness and ability to use their taxing powers.
“Property taxation is the largest own-source revenue at local levels,” Garsula said.
She believes that outdated land inventory and property tax base are the possible reasons why most of the LGU officials have failed to effectively collect real property taxes.
Other reasons could be that their tax assessments are not reflective of the current market values, poor collections, lack of political will and failure to mobilize and manage land resources.
Cebu City’s real property tax collection last year reached P642.4 million or P91.3 million higher than the P551.1 million target assigned by the BLGF.
During the recent seminar for the new elected mayors in the region the BLGF officials said they believe that most LGU officials are hesitant to intensify the collection of taxes because they thought it will be politically disadvantageous for them.
The law empowers the mayors and the local treasurers to be the prime movers of local revenue generation.
The local chief executives are charged with ensuring that all taxes and other revenues are collected, while the treasurers’ task is to collect the taxes through their authorized personnel.
Garsula explained that when all the key players in resource mobilization share the responsibilities in local revenue administration as a team, optimum results are attainable.
Those LGUs that only have a little collection of taxes are just depending on their shares of the Internal Revenue Allotment (IRA) from the national government. – THE FREEMAN