THE committee on budget and finance of the Cebu City Council is set to hold a budget hearing today to discuss the close to P300 million additional budget that the executive department is asking for this year.
Mayor Tomas Osmeña submitted to the City Council the third supplemental budget (SB 3) of the City amounting to P299,892,350.
In his letter to the Council dated Aug. 28, Osmeña said the additional budget will cover some urgent and necessary expenses this year.
The bulk of SB 3, pegged at P188.4 million, will be used to pay the compromise basic tax deficiency to the Bureau of Internal Revenue (BIR).
Councilor Margarita Osmeña explained that the City incurred a tax deficiency with the BIR due to the taxable transactions related to the sale of South Road Properties (SRP) lots in the previous years and during the previous administration.
If the City will not go for a compromise, it will have to pay a bigger amount that is estimated to reach around P1.2 billion, Osmeña said.
She said the mayor has been convincing the Secretary of Finance to allow the City to pay for a compromise amount instead of the amount that the BIR billed to the City.
“Actually, the compromise has not been approved, but part of the condition that they set for us is for the City to allocate P188 million, which is 40 percent of the assessed due of the City when it comes to taxes,” she said.
The City did not pay taxes to the BIR for the sale of SRP lots before because it contended that being a local government unit, it is exempted from paying it.
Other items in the proposed SB 3 include P55 million additional fund for the City Hospitalization Assistance and Medicine Program, P40 million for paving and retreading of various city streets and P8 million for aid to Barangay Banilad, among others.
The executive department has realigned some continuing appropriations amounting to some P291.8 million and P8 million from aid that Barangay Banilad returned as sources of fund for the SB 3. (RVC)