Saturday, August 23, 2008 Private school reps grill Carillo on taxes
OFFICIALS of some 100 private schools grilled a Cebu City councilor yesterday with their complaints on local taxation, and questioned the legality of the taxes imposed on them by the City Government.
Others said the tax rate is exorbitant, and with the interests and penalties they are being asked to pay, the City could own their schools and properties.
Exempt
City Hall collects three-fourths of one percent of the proprietary school’s or hospital’s gross receipts for the previous year. Some have not been paying, saying they are exempt from business taxes.
Councilor Gerardo Carillo, chairman of the City Council committee on education, said he was caught unprepared at the forum with the Private Schools Association of Cebu City and did not know that taxation will be discussed.
“Gilabhan gyud ko... They complained why we are collecting taxes from them and why the tax rates are high. They raised the issue that they are exempt from all taxes.
But there’s already a case on this pending in court, so we will just let the courts decide on this,” he told Sun.Star Cebu.
Carillo said the school officials reiterated arguments that schools are exempt from business tax payments because their operations are service-oriented.
“They also questioned the collection of penalties and high interest rates, which, if added to the taxes due, makatag-iya na man kuno ang City sa ilang skwelahan. They pointed out that if the case is pending in court, why does the City keep on collecting? There is a case but there’s no injunction order stopping the City from collecting,” he explained.
Problems
Some 100 private pre-schools, elementary, secondary and tertiary schools attended the forum at the Cebu City Schools Division office yesterday.
In a phone interview, former councilor Joy Augustus Young said the forum was organized to address the private schools’ problems with government offices.
Concerns on the peace and order situation in the city and the required school facilities were also tackled.
But the collection of business taxes from schools was the most highly contentious issue tackled yesterday, Young said.
“It was a hot issue. The school officials really wanted an explanation why the City is collecting taxes from them when they are exempted from paying. Yes, they are
exempted from paying national taxes but not local taxes,” he explained.
“We told them that we can’t do anything at this point because there is a pending case. They were still vocal about it anyway, and I think they are entitled to that,” Young continued.
Seven proprietary schools and hospitals have refused to pay P155 million in business taxes and questioned in court the validity of the City Government’s amendatory tax ordinance.
That ordinance imposed a tax rate of three-fourths of one percent of their gross receipts for the previous year.
The institutions argued that the Local Government Code exempts them from paying business taxes because of the nature of their business. (LCR)
