CEBU -- A private university sued Thursday the Cebu City Government and City Treasurer Ofelia Oliva, and asked its tax assessment of more than P19 million be declared void.

The University of the Visayas, Inc. (UV), represented by its president, Representative Eduardo Gullas, said in its lawsuit that UV is a non-stock, non-profit organization.

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UV’s legal counsel, Teodoro Almase, asked the court to issue a temporary restraining order and eventually, a writ of preliminary injunction, against the tax assessment.

Last Nov. 17, 2009, the City Treasurer’s Office notified UV about its allegedly unpaid business taxes amounting to P19,367,800 from 2004-2009.

The university contested the tax assessment but City Hall denied the protest.

The city treasurer then sent a final demand to the university. City Hall threatened to file administrative complaints against the university management if it fails to settle its business tax dues by Jan. 18.

Cebu City Mayor Tomas Osmeña does not believe UV is a non-stock, non-profit institution, and said it should just prove its claim in court.

He raised his doubts on the claim of Representative Eduardo Gullas (Cebu City, first district), who is representing the family-owned university in the civil case, and pointed out he was able to construct a “mansion” in Barangay Guadalupe.

“Non-profit? Maybe the birds and the bees believe him. I guess his new P200-million mansion in Guadalupe is purely imagined,” Osmeña said in a text message sent to Sun.Star Cebu. He declined to comment further on the case, and said City Hall lawyers will handle the matter.

The city has said it might levy the university’s properties, including bank accounts, if UV continues to ignore its tax obligations. But Almase said the city treasurer erred in the assessment.

The university acknowledged its obligation to pay regulatory fees, like those for permits, zoning and garbage collection, but that these amounted to only P28,150 from 2004-2009.

Almase said the university’s status as a non-stock, non-profit educational institution is recognized by the Department of Education and the Securities and Exchange Commission, and the City Government has no authority to impose business or corporate taxes on the university.

The Cebu City Council, the lawyer said, passed a tax ordinance limited only to proprietary schools, excluding the non-stock, non-profit educational institutions.

City Hall’s threat to file administrative complaints and seize properties “would paralyze the whole operations of the school, cause grave and irreparable damage and injury not only to UV, but also to the members of the faculty, administrative staff, students, and the Cebu City community,” said Almase.

Gullas and Osmeña have previously tangled. Talisay City’s claim that it owns part of the South Road Properties of Cebu City has soured relations between the two public officials. (GMD/With LCR of Sun.Star Cebu)