Tax holiday ordinance in Cebu City proposed

CEBU, Philippines - To increase the city’s revenues, a Cebu City councilor is proposing a tax holiday or tax relief on unpaid real property taxes.

City Councilor Noel Wenceslao said his proposal aims to collect overdue real property taxes effectively.

“As per records of the Office of the City Treasurer, the city has substantial unrealized revenue in view of the unpaid delinquent real property taxes due and collectible,” he said.

If approved, the measure will be called “The Cebu City Real Property Tax Holiday Ordinance of 2015.”

The proposal is now with the council’s committee on laws headed by Councilor Sisinio Andales for comments and recommendations.

Wenceslao cited section 192 of Republic Act 7160, which states that local government units may, through ordinances duly approved, grant tax exemptions, incentives or relief under such terms and conditions as they may deem necessary.

Tax holiday or tax relief is a “limited-time opportunity for a specified group of taxpayers to pay a defined amount, in exchange for forgiveness of tax liability (for the interest) relating to a previous tax period or periods.”

Wenceslao said the grant of tax holiday on the interests on delinquent real properties will give incentive and encourage payment of the unpaid dues.

In this way, he said that the city will improve its tax collection.

Section 3 of the proposed measure states that the grant of tax holiday or tax relief shall fall on the real properties such as land, machinery, building, residential, commercial, industrial and other classes of real properties in Cebu City.

Section 4 provides the kinds of tax holiday or relief in a form of condonation of the payment of the interest on delinquent real properties; “full tax holiday (100 percent) shall be granted on the interests on unpaid real property taxes for the period from January 2009 to 2014; and 50 percent tax holiday shall be granted on the interests on unpaid real property taxes for the period from January 2008 and prior years.”

Real properties that have been disposed of at a public auction to satisfy real property tax delinquencies are excluded from the coverage of the tax holiday. —JMO (FREEMAN)