CEBU CITY -- City officials want the University of the Visayas (UV) to prove in court that it is a non-stock and non-profit institution, as the city treasurer warned that all judicial and administrative actions will be taken against it for operating without a business permit and for not paying taxes.

City Treasurer Ofelia Oliva again asked UV officials to present their Books of Accounts in court so these can be examined, to find out if they are really tax-exempt.

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Mayor Tomas Osmeña said UV Colon’s claim that it is a non-stock and non-profit institution and is therefore exempt from paying taxes is just a farce.

Even if it doesn’t have a business permit, he said, however, that UV does not have to be shut down if it pays taxes like other business establishments.

“To me, it’s really a big farce. Non-stock non-profit? Tan-awa ang mga mansions sa mga Gullas sa Maria Luisa, sa Barangay Guba ug Guadalupe, lupig gyud ang City Hall da (Check the mansions of the Gullases),” Osmeña said.

In his news conference Friday, he said Representative Eduardo Gullas (Cebu, first district) should be ashamed of himself for laws that protect his businesses.

Sun.Star tried but failed to get Gullas for comment.

Gullas represents the family-owned university in the civil case it filed against the City Government and Oliva, seeking to declare the business tax assessment amounting to P19 million null and void.

Osmeña said it is unfair that small businesses pay taxes to the city while UV, one of the biggest universities here, does not acknowledge its tax dues.

City Hall lawyer Lyndon Basan agreed with the city treasurer, saying UV’s status as non-stock and non-profit can be determined only upon the review of its Book of Accounts.

Basan said the City Attorney’s Office is still preparing their reply to the complaint, which they will submit to the court within 15 days.

“My contention here is that UV should present its Book of Accounts. They should be able to establish that no part of their income has incurred to the benefit of the stockholders or any individual. But how can we establish that if we have not examined their accounting records? These should be examined in court,” he said.

The legal office received its copy of the complaint last Thursday, which includes a copy of the Articles of Incorporation of Visayan Institute Corp., which owns UV.

According to the document, UV became a non-stock and non-profit institution only in November 13, 2006, which means that it was subject to local taxes before that.

“They said they became non-stock and non-profit only in December 2006, so it is still questionable, that is why we have to look at their Books of Accounts. Prior to their conversion as non-stock non-profit, taxable gyud sila. Even after 2006, they can be considered taxable if part of their income goes to the stockholders,” he said.

For her part, Oliva said she will face the case in court, but she will also continue to exercise all judicial and administrative remedies to collect taxes, including putting a levy on UV’s properties.

To find out if they are really tax-exempt, UV should allow the city’s accountants to examine its Book of Accounts. UV had previously refused this examination.

Aside from the school’s income, the City Treasurer’s Office (CTO) will also check if the school’s officials and owners receive dividends, if there is any declared surplus adjustments and if there are benefits given to the school’s board of directors.

“Even if they say they are non-stock non-profit, I will have to examine their Books of Accounts to determine if they are really non-stock and non-profit. If they are non-stock, then we will issue them a certificate of tax exemption. Let them just prove it in court,” Oliva said.

Unless the Books of Accounts are inspected, the CTO will not issue any business permit.

“Since time immemorial, they have not been paying their business taxes. If they continue to refuse, then we will be constrained to proceed with abdication or levy of property,” Oliva continued.

Osmeña said he will stand firm on his stance on schools that don’t pay taxes, more so that schools are a major cause of traffic in the city.

Aside from the garbage that the city collects from the campuses, the city also deploys traffic enforcers in the schools. (LCR/Sun.Star Cebu)