Vol. XXII, No. 169 [ BusinessWorld Online ]
Monday, March 30, 2009 | MANILA, PHILIPPINES
DAVAO CITY — The city government has rejected a petition filed by the Davao City Chamber of Commerce and Industry, Inc. to put on hold higher property taxes.
City Assessor Cesar Dataya said the city government will continue to impose the increased fair market values, which started last year, unless the court intervenes.
"In fairness to the city council, the proposed ordinance was submitted way before the global crisis," he said, adding that the last time the city raised the fair market values was 15 years ago, when the law authorized local governments to change the property tax schedule every five years.
The city’s business chamber, represent-ing close to 400 members, opposed the increase, noting that it comes at a time that the retailers and restaurants in the city have started feeling a slowdown in consumer spending.
"The burden of higher realty taxes at this time will be counterproductive and will help deepen the recession [sic] locally, rather than alleviate it," the petition, signed by chamber president Simeon P. Marfori II, said.
The chamber said the new schedule is "unjustifiably excessive and confiscatory," noting that it raised fair market values of properties in the city by 40% to as much as 11 times. Citing examples, Mr. Marfori said the fair market value at Garcia Heights Subdivision, two kilometers north of the city proper, rose from P250 per square meter to P2,500/sq.m., while that of Ledesma Village, located just outside the downtown area, rose from P250/sq.m. to P3,000/sq.m.
"Due process was not observed by the City Assessor’s Office and the [city council] before this general revision of real property assessments," the chamber argued.
City Treasurer Rodrigo S. Riola said the tax take is not based on the fair market value but on the assessed value which is 10% of the base. "For example, the fair market value is P3 million, 10% of that, or P300,000, is the assessed value. You multiply that by .025 and you get P7,500 for the entire year." — Joel B. Escovilla
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