Iloilo to raise real property tax rates

ILOILO CITY, Philippines  — Businessmen, especially real property owners here, will have to brace for tax increase starting next year.

City Councilor Perla Zulueta said Mayor Jed Patrick Mabilog has written the City Council asking for the full implementation of the Schedule of the 2006 (real property) values "to raise revenues in order to ease fiscal difficulties."

Zulueta, who sits as chairperson of the City Council Committee on Ways and Means, clarified that the proposal is actually not an increase but the full implementation of the tax schedule that city is supposed to implement on real property owners.

In her proposed ordinance, Zulueta said 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 implemented in 2006.

However, she added they decided to implement the increase gradually to mitigate the impact on real property tax owners. "But it was not implemented fully because we are considerate of the taxpayers," Zulueta said.

In 2006 and 2007, the councilor said the city just implemented 50 percent of the increase and 60 percent in 2008 until the present.

"The proposed 2009 revision of the market values was deferred due to Typhoon Frank which devastated Iloilo in 2008, so the increase in assessment of real property tax value was retained up to year 2011," Zulueta explained.

As of third quarter of 2011, there are 146,326 real property units in Iloilo City. Of the number, 106,573 are considered taxable and 39,753 are exempted.

Those exempted from payment of real property tax are properties owned by the Republic of the Philippines, charitable institutions, non-profit or religious cemeteries, all lands, buildings and improvements actually, directly and exclusively used for religious, charitable or educational purposes, machineries and equipment used by water districts, owned by registered cooperatives and machinery and equipment for pollution control and environment protection.

According to Zulueta, based on the Local Government Code, a local government unit can implement up to 20 or 30 percent tax on the total market value of the property but the city at present is only imposing 2.5 percent levy for land and 3 percent levy or buildings, machineries and improvements.

This year, with the 60 percent implementation of the schedule of values of real property tax, the city has a collectible of P243,726,023.29. The amount is expected to go up to P303,265,017.05 when the city starts the 100 percent implementation of the schedule of values.

Zulueta said the increase in the city's real property tax collection would result in better delivery of basic services to the constituents. (FREEMAN)