‘THIS IS JUST POLITICS’: Mayor lashes out as RPT-inflation link sparks row; PSA flip-flops

By Rjay Zuriaga Castor

Iloilo City Mayor Raisa Treñas-Chu on Monday, Aug. 18, dismissed claims that the city’s 300% real property tax (RPT) hike directly fueled inflation, branding the issue as “political maneuvering.”

Treñas-Chu argued that if the RPT increase directly impacted inflation, it would have been reflected consistently over the past two years.

“For the past two years, the inflation rate should have been just increasing, but it’s fluctuating,” she said.

She asserted that the renewed criticism of the RPT hike is politically motivated.

“I am an economics graduate — I know that this is just politics,” she said.

Treñas-Chu holds a Bachelor of Science in Commerce (Business and Political Economics) from Assumption College and a Master of Business Administration from Ateneo Graduate School of Business.

She emphasized that inflation trends require long-term analysis and cannot be concluded from short-term fluctuations.

“You cannot just say in a span of three months that you’re already affected,” she added.

On Aug. 14, Philippine Statistics Authority–Western Visayas (PSA-6) Director Nelida Amolar explained during a press conference that businesses typically pass on higher tax costs to consumers.

She said increased RPT payments shrink profit margins, prompting businesses to adjust prices to recover losses.

“In general, if RPT increases, establishments will recover it by adding to the prices of commodities,” she said.

“If they pay more, they earn less — that is a direct effect, especially in wholesale, retail, and service sectors like restaurants and cafés,” Amolar added.

Following Treñas-Chu’s comments, Amolar reportedly clarified her earlier statements to the city government.

The city later quoted her as saying she “vehemently denied” ever claiming that the city’s inflation was “directly” caused by the RPT hike.

According to PSA-6, Iloilo City’s inflation rate rose to 3.7% in July 2025, from 2.7% in June, one of the highest in Western Visayas.

An analysis by the Institute of Contemporary Economics (ICE), a local think tank, linked the RPT hike to Iloilo City’s “significant rise” in July inflation.

The report noted that even with a 40% discount, many property owners continue to face increased financial burdens, which are passed on to consumers.

THE TAX HIKE

In 2024, Iloilo City implemented a 300% increase in real property tax rates, the first adjustment in 18 years.

The basic RPT, or land levy rate, was raised from 1.5% to 2% of assessed land value.

The ad valorem tax on idle lands also increased from 1% to 2% for residential lands and from 2% to 3% for agricultural, commercial, and industrial idle lands.

The city government said the hike was driven by rapid economic growth, a booming real estate market, and a March 2023 memo from the Commission on Audit urging the revision of fair market values.

The increase drew immediate backlash from property owners and business groups.

In response, the City Council passed a resolution granting a 40% discount for 2024 and 2025.

“To mitigate the financial difficulty faced by Iloilo City’s taxpayers […] a reduction for the imposed RPT is deemed crucial and proper in this case,” the resolution read.

The discount was later extended to 2026.

It applies only to the basic RPT on land and excludes the higher ad valorem tax on idle properties.

Taxpayers who settle their dues early or before Dec. 31 of the payment year are also granted an additional 10% discount as an incentive for prompt payment.

EXTENDED DISCOUNT, REDUCTION PUSHED

Less than a week into her term, Treñas-Chu appealed to the City Council to extend the 40% discount further, until 2028.

In her letter, she cited “countless appeals from taxpayers, the business community, and other stakeholders” regarding the burden of the new property valuations.

The measure remains pending at the committee level.

Opposition Councilor Sheen Marie Mabilog, meanwhile, pushed for stronger relief measures, including an 80% reduction in the RPT.

She filed two separate ordinances, but both failed to pass first reading.

Mabilog also proposed a resolution requiring finance officials to submit a fiscal impact assessment of the tax hike, which was also rejected.

On Aug. 13, tensions escalated during a council session when Mabilog was barred from delivering a privilege speech on the RPT–inflation link.

Her speech was not included in the approved agenda.

Assistant Majority Floor Leader Councilor Romel Duron said the speech could not proceed as it dealt again with the RPT issue.

When asked to provide a copy of her speech, Mabilog refused.

A vote followed, and the majority upheld the decision to stop her from speaking.