Cebu City RPT to increase after amnesty ends in 2026

MANILA, Philippines —  Real Property Tax (RPT) rates of Cebu City remain the same as in 2003, as taxpayers still enjoy the two-year amnesty before the implementation of updated tax rates in 2026 due to the Real Property Valuation and Assessment Reform Act (RPVARA).

In an interview with The Freeman yesterday, April 13, 2025, Councilor Noel Wenceslao, chairman of the Committee on Budget and Finance of the City Council, discussed the proposed ordinance to revise the current RPT rates of Cebu City.

According to Wenceslao, the tax year amnesty is still in effect in Cebu City following the Executive Order (EO) issued by Mayor Raymond Alvin Garcia last year, in line with the implementation of provisions cited in RPVARA.

Under that EO, the Cebu City Government waived the payment of penalties for delinquent RPT payers, aiming to encourage constituents to pay their principal taxes.

The two-year grace period began on July 5, 2024, and will last until July 4, 2026.

Despite this, Wenceslao said this does not mean Cebu City will no longer be updating the RPT, which could lead to an increase in overall tax rates.

 After the two-year period, that s the time nga magsugod nata og upgrade sa atong mga kanang Fair Market Value,  said Wenceslao.

The Fair Market Value (FMV), or the valuation of a property, as previously explained by Wenceslao, is the basis for the new tax rates and will be the primary factor that could lead to higher updated tax rates.

Wenceslao, however, said they have already received the Implementing Rules and Regulations (IRR) of the RPVARA, which lays out the option for the Local Government Unit (LGU) to impose a tax holiday before enforcing the updated tax rates.

In line with this, taxpayers will begin to feel the impact of increased tax rates next year. According to Wenceslao, they still have to determine the most reasonable FMV. He added that should the new property assessment result in increased RPT rates, they may have to readjust another factor, which is the assessment level.

It was explained that to compute the revised tax rate, the calculation will begin by determining the number of square meters of a property, which will be multiplied by the most recent FMV.

This will then be multiplied by the assessment level, which is set at two percent for residential and ten percent for commercial properties, in order to arrive at the assessment value.

From there, the assessment value will be multiplied by the tax rate, which is three percent, to arrive at the corresponding tax amount.

 Di ta kaingon (if it s lesser) because we do not know the surge of the Fair Market Value,  said Wenceslao.

Wenceslao explained that although there was already public clamor when the updated tax rates were first introduced while lobbying for the revised RPT, there is still a possibility that these rates could further increase in 2026.

He added that under the RPVARA Law, the Assessor s Office will still come up with the updated tax rates; however, these will have to go through the Bureau of Local Government Finance (BLGF) for review. Wenceslao also said the BLGF will be the one to approve the FMV.

 Definitely it will come true (next year) kay kinahanglan na gyud mag update, according to law,  said Wenceslao.

As earlier reported, just as the council was about to hold the final deliberation on the revised RPT, the RPVARA was signed into law, superseding the provisions in the proposed revision of the city s tax rates, which have not been updated since 2003.

Under the newly signed RPVARA law, the LGU is no longer responsible for updating the absolute values on which the new tax rates are based. The LGU, however, according to Wenceslao, can still exercise the power to adjust them.

The RPVARA law was signed by President Ferdinand Marcos Jr. on June 13, 2024. It aims to standardize, streamline, and enhance the country s valuation and assessment of real property through a uniform appraisal system that complies with international standards. (CEBU NEWS)