For the first time in 23 years, the city government of Valenzuela is increasing the market values of industrial real properties.

The Office of the City Assessor is now following a new schedule of market values (SMV) for industrial real properties, based on the Ordinance No. 169, Series of 2014, which was passed last November. This replaces the previous one which has been in use since 1992.

On the new SMV, the unit value of lands classified as First Class, which was previously priced at Php2,000, is Php6, 000. Those falling under Second and Third Classes are now valued at Php4, 500 and Php3,000, respectively, from the previous Php 1,500 and Php1,000.

Classifications of industrial buildings, on the other hand, have been made consistent with the provisions of the National Building Code.

Called-for move

Atty. Cecilynne Andrade, Head of the City Assessor’s Office, said the revision is a called-for move, pointing out that the Republic Act 7160, or the Local Government Code of 1991, orders local governments to revise their SMVs for real properties every three years.

However, the Republic Act 8526, the law that converted the former municipality into a city in 1998, also provides that the local government can only increase taxes five years after the conversion.

So, by now, the city should have revised its SMV five times – in 1997, 2004, 2007, 2010, and 2013.

Andrade also cited the Joint Memorandum Circular No. 2010-01 of the Department of Finance and the Department of Interior and Local Government, which enjoins all presiding officers and members of the City Council to calendar, deliberate and pass an ordinance incorporating the proposed updated SMV prepared by the City Assessor.

The current revisions only include industrial real properties, and forgo residential and commercial.

“For 17 years, Valenzuela was a highly urbanized city running on municipal industrial real property tax rates,” said Andrade of the local government which was hailed as the Most Business-Friendly by the National Competitiveness Council in 2012 and 2014.

Business groups support hike

The local business groups have expressed their support on the new SMV, which they say is timely and reasonable.

In an October 24, 2014 letter, Tomas T. Ang, President of the Chamber of Commerce and Industry in Valenzuela, said: “We recognize that the City is primarily responsible for having a proper, efficient, and effective administration of the real property tax. We accordingly acknowledge that now is the time to make this revision. We believe this is reasonable considering that the existing rate is a municipal rate and that no increase was made for twenty-two (22) years.”

On the other hand, Jose P. Marcelo, President of the Valenzuela Business Club, said in a letter dated October 28, 2014 that the organization is “aware that our taxes will be put to good use for the promotion of progress of Valenzuela City.”

In 2013, the city’s income from real property taxes amounted to Php281,820,326.94, which comprised around 15 percent of the total income of Php1, 939,557,363.79, the City Treasurer’s Office reports.