CEBU CITY, Philippines—Keep the businesses in the city, pass the tax amnesty.
This was the plea of Cebu City Treasurer’s Office (CTO) after the Cebu City Council once again deferred, for the fifth time, the passing of the tax amnesty ordinance.
The tax amnesty ordinance would have waived the penalty fees incurred by businesses in the past years, allowing them to pay only the principal tax and helping them continue their trade in the city.
Mayor Edgardo Labella’s appointed City Treasurer, Lawyer Jerone Castillo, said the longer the ordinance is not passed, the more businesses, especially small ones, would pack up and leave the city.
“This is what happens when a business can no longer pay their taxes because the penalty is already bigger than their principal tax. They will pack up and leave for Mandaue or Talisay, because they have lower tax or lower penalty,” said Castillo.
Castillo emphasized that the CTO only wants to waive most of the penalty, but those with incurring violations will still pay a 20 percent penalty based on their principal tax.
“Twenty percent is already payable compared to the large debts that these businesses incurred. This is a big help for our small and medium enterprises (SMEs),” he said.
He also said that he understands the scrutiny of the City Council over the ordinance because it is the council’s job to protect the constituents.
Yet, he said it is also the CTO’s job to collect as much income as they can for the city.
“Businesses will not want to pay their taxes in our city anymore because they cannot afford to with a huge debt on fines. It will be much harder for us to collect. In the end, we may collect nothing because there is no longer businesses to collect from,” said Castillo. /bmjo