QC could put land value hike on hold

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Quezon City hall

By Vann Marlo M. Villegas

QUEZON CITY (QC) residents and businesses are likely to get a reprieve from an already deferred hefty increase in real property tax looming in January next year, as Mayor-elect Maria Josefina “Joy” G. Belmonte said she plans to put on hold implementation of higher land fair market values (FMV) pending “further consultation with the people.”

The city government issued QC Ordinance No. SP-2556, Series of 2016, in December 2016, increasing FMVs. But the Supreme Court (SC) halted implementation as it issued a temporary restraining order (TRO) on April 18, 2017 in response to a petition of Alliance of Quezon City Homeowners’ Association, Inc. (AQCHAI). The high court lifted the TRO on Sept. 18, 2018, allowing the hike to proceed. But the QC government suspended implementation to January 2020 through Ordinance No. SP-2778, Series of 2018 on Dec. 6, 2018.

“There’s still confusion about it and some taxpayers… asked that it be reviewed more thoroughly so they can participate more [in discussions on this tax issue],” Ms. Belmonte said in a telephone interview on Wednesday last week.

“I made the declaration that I will not implementing this ordinance; well, until such time additional revenue is necessary to run the city.”


Noting that “may mga iba pang mga homeowners’ magfa-file ulit… ng isa pang TRO (there are homeowners that will again seek a TRO from the court),” she said that “rather than mag-file kayo nang mag-file ng TRO, we’ll hold it in abeyance.”

“Let’s not implement and let’s just do further consultation with the people.”

Ms. Belmote said she will consult the Department of Finance (DoF), Commission on Audit and the Department of the Interior and Local Government on this plan.

Kung okay naman sa kanila na wag muna i-implement, hindi muna natin i-implement in my first term (If it is okay with them, we will not implement it in my first term) and possibly even more years should I be reelected. But I could only speak for my first term,” she said.

Elected local government officials serve a three-year term and can seek reelection for two more consecutive terms.

Ms. Belmonte said she will propose to at least devote her upcoming term as mayor to “further inform, further clarify with the homeowners what this means” in order to avert any application for another TRO.

While she said during her recent election campaign that such a higher tax could be warranted by new major projects, she said in last week’s interview that “chances of that are very slim.”

QC Ordinance No. SP-2556, Series of 2016, raised the FMVs of residential, commercial and industrial real properties by 400-733.33%, in turn raising tax payable by real property owners by an estimated 39-131%. New assessment levels are set at five percent for residential and 14% for commercial and industrial lands. The adjustments are expected to yield an additional P700 million in real property tax collection in the measure’s first year of implementation.

FMVs were last increased in December 1995 despite the requirement of Republic Act No. 7160, or the Local Government Code of 1991, to adjust them every three years.

Sought for comment, DoF Assistant Secretary and spokesman Antonio Joselito G. Lambino II said the department “welcomes the opportunity” to dailogue with the mayor-elect regarding her plan. “I would be happy to share with her our proposal for the package three of the tax reform program. In fact, when I attended one of the meetings of the League of Cities of the Philippines, it was one of the proposals we were told was something the mayors found quite appealing,” he said in a telephone interview on Friday.

House Bill No. 8453, or the proposed “Real Property Valuation and Assessment Reform Act,” that was approved on third and final reading by the House of Representatives in November last year, aims to centralize valuation and assessment of real properties. The measure will be the basis of local appraisers and assessors for the schedule of market values that will be the basis of national and local real property-related taxes. It also tasks the Bureau of Local Government Finance to develop standardized valuation system, in line with international standards.

Sought for comment, AQCHAI President Danilo Liwanag called for more consultations with real property owners.

“(W)ala naman problema ‘yun sa mga homeowners association… hindi kami nag-o-object sa pagtaas ng FMV, kasi tama ‘yan; eh kasi since 1995 pa hindi tumataas ang FMV (Homeowners associations do not have a problem with the higher FMVs per se, since these values have not been adjusted since 1995),” Mr. Liwanag said in a telephone interview on Thursday last week.

Ang ino-oppose namin ‘yung sobrang taas ng real property tax na naka-base doon sa FMV. Pwede naman kasing gumawa ng isang formula na hindi magiging masakit sa bulsa ng mga magbabayad (What we oppose is the very big increase of real property tax that is based on the FMV. There could be a formula to make sure any increase will not be too much of a burden for taxpayers.)

Mr. Liwanag added that the city government should inform constituents about where the additional funds will be used.

’Yan ang importante: humarap sila sa amin. Pag-usapan kung ano ang ikabubuti ng siyudad. (That is what is important: they should face us and talk about the betterment of the city),” he said, adding that consultations conducted had been attended by only a few real property owners.

Mr. Liwanag said his group is poised to ask the court for a new TRO since the current ordinance setting a January 2020 implementation remains in force. “Kami naman, kailangan ulit magipon… kami ng mga tao, magrereklamo para ipa-TRO nanaman ’yan… gumagawa na kami ngayon talaga ng paraan para mapa-TRO ulit yan (Our group is again gathering people and finding ways in order to secure another TRO against that ordinance)”, he said.

Also sought for comment, Philippine Chamber of Commerce and Industry-QC President Sarah P. Deloraya-Mateo said in a mobile phone message on Friday that “… [t]he policy behind the proposed implementation (of the increase) should be discussed with the public so the people can properly make a sound judgment,” and asked that “increased rates… be justified by a lawful purpose that will benefit QC stakeholders.”

Ms. Deloraya-Mateo noted that the chamber and other business organizations were consulted in 2016, “but not all agreed with the increase.”