Mayor eyes gradual rollout of future RPT hikes but…

By Rjay Zuriaga Castor

Iloilo City Mayor Raisa Treñas-Chu defended the controversial 300% increase in real property tax (RPT), citing the devolution of certain national government functions to local government units (LGUs).

She argued that the devolution has left the city government unprepared to manage and deliver basic services and facilities independently.

“We have to take into consideration nga nag devolution and wala kita napreparahan kay nag gulpi,” she said in a press conference Monday, Sept. 1.

The Local Government Code of 1991 (Republic Act 7160) originally granted LGUs greater authority over local resources, fiscal management, and decision-making, including the power to generate revenue and set budgets.

This process was accelerated by the 2018 Mandanas-Garcia Supreme Court ruling, which expanded the LGU share of the Internal Revenue Allotment.

To carry out this ruling and fast-track devolution, former President Rodrigo Duterte issued Executive Order 138 in 2021, mandating the full transfer of certain functions from national agencies to LGUs.

These devolved functions include health services, agriculture, infrastructure, environmental management, and local economic development.

“If we had been prepared, it would have started with just a few departments, then gradually expanded. But we had to take it all at once,” Treñas-Chu said.

In Iloilo City, she noted that devolution gave the city responsibility for improving health and education services, including paying for school utilities.

Treñas-Chu said a staggered implementation of the RPT increase may be considered in the future but emphasized that several factors must first be reviewed.

“Maybe it can be gradual moving forward,” she said.

Former Finance Secretary Jesus Estanislao earlier said the adjustment—the first in 18 years—was justified but should be implemented gradually.

Treñas-Chu also pointed to the Real Property Valuation and Assessment Reform Act (RPVARA) or Republic Act 12001, which took effect July 5, 2024.

The RPVARA establishes a single valuation base derived from the Schedule of Market Values that all LGUs and government agencies must use for property tax assessments and other valuation purposes.

After the initial updating period in July 2024, LGUs must revise property assessments and classifications every three years.

This means the next general revisions after 2024 will take place in 2027 and then in 2030, continuing on a triennial basis.

To ease the impact of the 2024 RPT increase, the city government granted a 40% discount on the tax increase until 2026.

Responding to business sector appeals, Treñas-Chu endorsed to the City Council a proposal to extend the discount until 2028.

Taxpayers who settle their dues in full before the deadline are also entitled to a 10% discount.

Other incentives include a 20% discount for property owners who install solar panels and a 50% discount for heritage buildings certified by the Iloilo City Cultural Heritage Conservation Council.