Parañaque not raising realty tax despite COA’s advice

By Jaymee T. Gamil
Philippine Daily Inquirer

Parañaque Mayor Edwin Olivarez stood pat on his decision not to raise real property taxes (RPT), despite recommendations for an increase by the Commission on Audit (COA) and the previous city administration.

During the blessing rites for the new treasurer’s office and taxpayers’ lounge at city hall on Thursday, Olivarez stressed in a speech that “in my time, we will not increase taxes. We will just do more efficient collection.”

Olivarez was stating his position on the proposed increase in real property market values under Ordinance No. 11-11, which the council under the previous city administration passed in October 2011.

The ordinance updated the schedule of values for land, buildings and other improvements in Parañaque, since the Local Government Code calls for a revision of the real property value assessment every three years. The last assessment in the city was in 1997.

Hence, the ordinance effectively raises the value of land on which the computation for the real property tax is based.

However, after a group of homeowners challenged the measure in the Supreme Court for alleged lack of due process, a temporary restraining order (TRO) suspended its implementation in November 2011.

Olivarez earlier said he had been calling on the council to repeal the ordinance so that the land values would remain in the 1997 level while those for buildings and other improvements would stay in the 1992 level.

But in its 2012 annual audit report on the city, the COA recommended the opposite.

“Considering that the last general revision of real property assessment was way back in 1997, the lapse of 15 years without revision of assessments was highly questionable and grossly disadvantageous to the city government because the bases being used in the computation of taxes due the city are no longer current and realistic. This prevented the city from collecting additional revenues to finance the implementation of its various activities, programs and projects that may enhance the quality of life of its constituents,’’ the report read.

The state audit agency also said it was for the lifting of the TRO against Ordinance No. 11-11. “Otherwise, the city government will continue to experience cash-flow crunch in view of the massive expenditures without corresponding increase in collection of local taxes,” it said.

The COA estimated that city revenues resulting from updated real property values could reach about P395 million.

In an interview, city administrator Ding Soriano said the Olivarez administration “continues to oppose” the ordinance. “We see no reason to increase the fair market value or the real property taxes of the city. We believe that what we need is enforcement of collection of taxes.”