SP suspends ordinance on new property values
posted 7-Jan-2019  ·  
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The Sangguniang Panlalawigan has passed an ordinance suspending for one (1) year the implementation of the new Schedule of Market Values of real properties in the province that has led to doubling of real property tax assessments.

Governor Joseph Cua signed the copy of Provincial Ordinance No. 022-2018 last Friday afternoon (Dec. 28, 2018) following its transmission by the provincial board headed by Vice Governor Shirley Abundo.

The suspension covers the period January 1, 2019 to December 31, 2019, with the SP silent on whether it would consider amending the ordinance to lower the market values to more affordable and acceptable levels.

The much-awaited relief from the higher real estate taxes was not immediately felt as the ordinance will take effect only after 10 days of its posting in a bulletin board at the provincial capitol and at least one other conspicuous place within the island not later than five (5) days after its approval, pursuant to Section 59 of the Local Government Code.

A copy of the ordinance secured by the Tribune showed the board passed the resolution-ordinance, sponsored by Provincial Board Members Giovanni Balmadrid and Rafael Zuniega, during their 13th   Session last Dec. 21, 2018.

It cited as the basis for the suspension Resolution No. 1-2018 of the League of Municipalities of the Philippines (LMP) Catanduanes Chapter requesting the SP to suspend the implementation of Provincial Ordinance No. 004-2018 on the grounds that it will have a negative impact on the efficiency of collection of real property taxes and on the livelihood of Catandunganons.

The board also considered the clamor of private and public sectors for its suspension claiming that the sudden increase of the market values of real property imposed under the ordinance is an added financial burden to the rising prices of basic commodities.

It quoted data from the Philippine Statistic Authority (PSA) Catanduanes provincial office, showing the trend of rising inflation rates for Catanduanes for the first 10 months of 2018: January, 3.7%; June, 5.7%; July, 7%; August, 8.1%; September, 9.6%; and, October, 9.1%.

“(This) clearly indicates the burden experienced by our constituents with sudden increase of the market values imposed under the said ordinance,” the board stated.

“T(o) address the cry of our constituents and ease their burden, it is only fair and reasonable that the implementation of Provincial Ordinance No. 004-2018 be suspended until the inflation rate decreases at least to the level during the year 2017,” it stressed.

Any advance of excess payment made as a result of the implementation of said ordinance should be treated as tax credit against future real property tax liabilities of the owner, the SP clarified.

The provincial board took prompt action recently when it received complaints from real property owners intent on paying their estate taxes in advance to avail of the 20% discount but instead were shocked when they found out that their tax due for 2019 has more than doubled compared to what they paid a year ago.

Under said ordinance, the base market values for commercial and residential lands were increased by 100 to 200 percent particularly along national roads and business districts, with all other areas doubling in value.

In Virac alone, the business areas in barangays Concepcion, San Jose, Salvacion, Sta. Elena, and Sta. Cruz saw their market values zoom from the original P3,000 per square meter to P10,000 per square meter.

In the previous General Revision in 2013, the same values increased by at least 100%, from P1,500 to P3,000 while in some areas it went from P1,000 to P2,500.

The increase in the San Roque along both sides of Masagca St. to Augusto St. was highest, tripling from the original P2,500 to P10,000 per square meter. In other residential and commercial areas, the market values of properties either doubled or tripled, depending on their location and distance from the main road.

Even the other 10 towns were not spared from the huge hike in real property assessment and taxes.

Here are examples of the increases in market values of commercial lands by towns: Bagamanoc, from P300 to P1,000 per square meter; Baras, from P600 to P1,200; Bato, from P650 to P1,300; Caramoran, from P600 to P960; Gigmoto, from P550 to P1,100; Pandan, from P750 to P1,500; Panganiban, from P700 to P1,400; San Andres, from P700 to P2,000; San Miguel, from P650 to P1,500; and, Viga, from P750 to P1,500.

An official said the SP should have conducted a tax impact study before approving the higher property values in order to determine its effect on the real property taxes to be paid by the public.

Records of the SP show that the Committee on Public Information conducted the mandatory public hearing on the proposed measure last April 5, 2017 at the session hall in Virac.

However, some Sangguniang Bayan members of different municipalities who were present informed the committee that “they were not cognizant (of) nor consulted prior thereto by their respective Municipal Assessor’s Offices.”

In April 2017, the SP enjoined the Sangguniang Bayans to review and submit recommendations to the proposed ordinance relative to the revision of the schedule of market values for real properties for 2017 in their respective towns.

It emphasized that the results of the review by the Sangguniang Bayans may be used as inputs in the determination as to “the appropriateness and viability, including the acceptability by their respectivfe constituents,” of said revision.

In Virac, however, a council member admitted that no action was taken by the body on the proposed schedule of market values submitted by the municipal assessor’s office.

The values were allegedly established based on the average buying price of property in each municipality as elicited by the local assessors from real estate brokers and agents.

While a number of property owners have crowded the Virac treasurer’s office to pay their dues and avail of the discount, many who had their  lands and buildings assessed have held off paying for the increased real property taxes until the suspension of the higher market values takes effect.

Under the LGC, the real property taxes paid by property owners and remitted to the provincial government are shared three ways, with 40 percent going to the municipality which collects the taxes, 25 percent to the barangay where the property is located, and the remaining 35% retained by the provincial government.

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