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Sunday, January 19, 2003
Suppliers ‘owe’ City?
By Jasmin G. Suma-oy
Of Sun.Star Cebu
SOME of the 122 suppliers and contractors of the Cebu City Hall may not get in full their pending claims for payment from the City Government.
City Treasurer Ofelia Oliva said that during verification, they saw discrepancies showing that these firms’ declared gross sales per business permit are much lower, compared to the supplies or projects awarded them by City Hall.
One establishment, for instance, declared in its permit gross sales of only P9 million, but got a supply contract of P17 million.
Another trading company declared only P186,200 yet it supplied materials to the City worth over P2.5 million.
“This means, the concerned suppliers and contractors have not paid correctly their business taxes and have, therefore, incurred tax deficiencies,” Oliva said in a letter to the City Council.
She has asked the local legislature to pass an ordinance authorizing her to withhold the computed business tax and prior year’s business tax deficiencies from their impending claims for payment.
This request, Oliva said, is in view of the thrust of the present administration for “tax consciousness among its constituents and for them to pay the correct amount of taxes due to the government, especially those who have business transactions with the City.”
Further study
In an interview, Councilor Jocelyn Pesquera, chairperson of the committee on budget and finance, said the Local Awards Committee also discussed how the City can collect the correct taxes from the suppliers.
In one of their meetings, the committee asked the city accountant, budget and treasurer to find the means.
But members of the administration Bando Osmeña-Pundok Kauswagan want the proposal of Oliva studied further.
During their caucus before the regular session last Wednesday, she revealed that her colleagues wanted the City to look first at what will be its effect on taxpayers and what will be their basis for withholding part of the suppliers’ payments.
“We want them to pay the right taxes but we also don’t want to lose suppliers and contractors,” Pesquera said.
One option is not to issue accreditation to the suppliers and contractors until they pay the correct taxes.
Without an accreditation, they will not be qualified to join the City’s biddings.
Payments late
Some suppliers had also complained that it takes ages before the City Government pays them.
Accounting records show that there are 122 establishments that deal with City Hall, with purchases ranging from P1,460 to as much as P17 million.
After Oliva, a personal choice of Mayor Tomas Osmeña, joined City Hall early last year, she also reviewed the tax payables of Cebu City’s over 100,000 real property owners and discovered several “errors” in computations.
She conducted a re-computation “to correct the deficiencies” that jacked up the payables of many of the real property owners.
After several complaints, Pesquera sponsored an ordinance seeking to grant amnesty to the taxpayers penalized “for the non-payment of true and accurate real property tax due.”
Osmeña has vetoed the ordinance, which was approved by all members of the City Council.
He has said, though, that he is still willing to discuss the ordinance with Pesquera if this is revised.
Oliva earlier told Sun.Star the mayor only wants to make sure the ordinance will not have any adverse impact on the City’s finances, as this may affect his campaign to raise revenues for the City.
Oliva admitted there have been complaints but she said this was only because the taxpayers were caught by surprise.
“But after we explained to them that they are not penalized but are only asked to pay the deficiencies because of the errors in computation, they kept quiet,” Oliva said.
(January 19, 2003 issue)
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