Local tax reduction under study: Davao City dad

DAVAO CITY – City Councilor Danilo Dayanghirang said the possibility of lowering local tax rates is being studied,  amid concerns on the impact of the 10 percent tax increase implemented by the city government to small traders this year.

Dayanghirang said the move came after the clamor from the small businesses, especially sari-sari store owners and market vendors, that their income had been affected by the increase in local taxes.

As a result, the councilor said small-scale traders have filed a request to the city government to consider lowering the tax rates. Worse, he added that some sari-sari store owners have even resorted to retiring their business permits because they could no longer afford the business fees.

Dayanghirang, the chairman of the City Council Committee on Finance, Ways and Means, and Appropriations, said the City Council is considering the request but only for those earning below PHP1 million.

For market rates, Dayanghirang said it was not possible to give in to the request of the vendors to reduce the tax fees to PHP4.00 from the current PHP6.00.

“I am closely coordinating with the executive department because I cannot do this without the support of City Hall,” Dayanghirang said in a press briefing on Tuesday.

Dayanghirang said that if the city decides to lower the business tax rates, the city council will have to amend the Local Tax Code again. He said this could impact on the revenue targets of the city government for 2019.

Dayanghirang assured the local government will find a way to address the request of the small traders, in a way that does not adversely impact the operation of the city government.

Beginning January this year, the city government started implementing the 10 percent increase in business and real property taxes after amending the Local Tax Code.

Dayanghirang said the last time the city updated its business tax and real property tax was nine years ago, prompted by a Commission on Audit (COA) report that the city's the business and real property taxes have remained low. (Lilian C. Mellejor/PNA)