City gov't told to defer tax code implementation

By Felix N. Codilla III

A GROUP of private sector individuals is requesting the local government unit (LGU) to defer the implementation of the 2011 Revenue Code of Ormoc. They are asking that more time and consultations be given to enable the public to scrutinize the proposed measure.

In a three-page letter addressed to Councilor Ruben Capahi, chairman of the ways and means committee, the civic leaders expressed concern on the varying levels of tax increases to be imposed on businesses. “It is very difficult to determine the rational basis for such impositions and we could not understand the pattern,” they said in the letter.

The increases range from 6.4% to 900% depending on the nature of business. One of the biggest tax increase, for example, will be imposed on fastfoods and restaurants at P1,000 from P190 or a whooping 426.3% hike. KTV/cocktail bars and similar establishments will pay 344.4% more on business tax or P1,000 from the present P225 (see table below).

But the most contentious increase that will affect the general public is water rates. Ormoc charges the lowest water rate in the country at P3.50/m³ for the first 10m³ and P3.85/m³ above 10m^3. The Revenue Code will raise this by 185% to P10/m³ for the first 41-50m³ and P11/m³ above 50 m³.

The Code will also begin to tax newly operated businesses at 7.5% of 1% of capital investment. It will also impose P20 monthly garbage fee on residents which will reflect on the water bill. The civic leaders believe these will make Ormoc unattractive to investors.

The letter criticized the hasty public hearing on the Revenue Code last Dec. 22 and 23 which it describes as “untimely” with many businessmen busy with year-end activities failing to attend. The general sentiment at the consultation is that the public wasn’t given enough time to study the Code as the 120-page document was distributed only during the first week of December.

The sectoral leaders urges the LGU to gather more inputs from multi-stakeholders and conduct more forums at the barangay level. In view of this, they also request ample time to allow various interest groups to study the proposal and come up with intelligent and realistic recommendations.

Otherwise, the LGU may not effectively enforce the Revenue Code for lack of acceptability from the general public, they warn. “People may end up disobeying…for the simple reason they are unable to comply with the ordinance,” the letter reads. The measure is now on second reading at the City Council.

The signatories of the letter are Engr. Jovencio Laurete Jr., president of Ormoc Chamber of Commerce and Industry; Ma. Milagros L. Rizarri, president of IAL Corp.,; Atty. Roy Bernard Fiel, vice president of Ormoc Sugar Planters Assoc.; Iñigo Larrazabal, incoming president of Rotary Club of Ormoc Bay; Atty. Benjamin Pongos, president of Ormoc Memorial Gardens; Marissa Omoto, president of Philippine Institute of Certified Public Accountants-Ormoc chapter; and Benedicto Lambunao, president of Ormoc Motorized Tricycle Operators and Drivers Association.