COMMITTEES on Trade and Commerce and Ways and Means chair Councilor George Goking said the zonal values, once in place, would serve as the proper barometer for the real price of lands and the appropriate taxes for such in the city.
“Property taxes are the largest source of tax revenue for local governments,” said Goking adding the provinces and cities are losing a huge amount of money in revenues annually as a result of outdated real property values.
Emphasizing the need for valuation reforms in the real property sector, according to Goking.
Representing the City mayor Rolando “Klarex” Uy, Goking said the Bureau of Internal Revenue (BIR) Revenue District No. 98 (CDO) and 97 (Gingoog) on Friday started their public hearings with government, private, and business sectors to finalize their respective zonal values for approval of the bureau.
Goking said the hearing in the proposed revision for zonal valuation per square meter would further invigorate the real estate demand in both the city and province including other nearby provinces in the region.
“It brings in more investments and generates additional revenues for local government units,” said Goking, adding a great help in attaining the city’s P7.8 billion proposed 2023 annual budget.
On November 4, according to Goking the City Council will soon begin to tackle the 2023 Executive Budget submitted by Mayor Uy for the city.
The P7.8 billion budget, P6.82 more for the General Fund while P977 thousand for the Special Account – Local Economic Enterprises/Utilities.
“Essentially, real estate is the most valuable asset and biggest financial resource especially in attaining the annual budget,” Goking said.
However, Goking said its contribution to government revenues, particularly for local governments, has remained dismal due to outdated SMVs, poor collection efficiency and tax administration, and lack of uniformity in the valuation of real property.
On behalf of Mayor Uy, Goking with Misamis Oriental Governor Peter Unabia welcomed the move of the BIR initiating the public hearing, particularly the revenue district 98 and 97 of for they propose the revision of the zonal values for real estate properties per square meter within the cities including the province of Misamis Oriental.
“This public hearing on zonal valuation is the city council is waiting for, as it helps in the review of the city’s Tax Code for 2015 that should have been done a long time ago,” according to Goking.
After all, he said a robust property industry will be vital in collective efforts to recover from the wide-ranging economic effects of Covid-19.
Meanwhile, this paper tried to contact BIR public information officer Amy Valencia for comment on the current city’s zonal values implemented per square meter but to no avail.
Until this writing, the BIR failed to reply to the text message sent them on the current zonal values of properties across the city and nearby provinces continue at pre-pandemic levels and that no increase be implemented during the time the country remains in a state of calamity due to Covid-19.
“The BIR on Friday just started their public hearing with government, private, and business sectors to finalize their respective zonal values for approval of the bureau, according to Goking.
Although the BIR, Goking said classified their proposed revision of the zonal valuation per square meter into highly developed, highly industrial, and well developed with the corresponding amount under a commercial or residential condominium, parking slot, industrial, commercial or residential regular.
Earlier, in the BIR report, it added the values proposed this year are not the same values from 2009, adding that the values are “much lower” than earlier proposed.
Meanwhile, Goking clarified city finance’ local government units (LGUs) currently have the power to decide on tax rates of real estate and its improvements.
He explained that LGU officials will still have the authority to decide to either or not follow the rates to be set by the national government under the proposed tax reform.
“If they want to apply it high or they want to apply it zero it’s up to them. So the principle of local autonomy is still maintained because they are the ones who will determine what rate to be applied to that valuation,” Goking said.
The BIR through its issued Revenue Memorandum Circular (RMC) 115-2020 on Oct. 21, 2020, informed concerned stakeholders that Certificate of Zonal Values of Real Properties (certification) shall only be issued by the concerned Revenue District Offices (RDOs) having jurisdiction over the property location.
The certification shall be used by the applicant in their transactions with other government offices or private entities.