Baguio may raise taxes

BAGUIO CITY—The summer capital is facing a fiscal problem next year because of dwindling tourism revenues and projected cuts in its internal revenue allotments (IRA) due to the creation of 16 new cities, Mayor Mauricio Domogan said.

But in his state of the city address on Monday, Domogan said he preferred to raise real estate taxes and upgrade the local tax code than allow any form of gambling, even state-run games, to operate for extra revenues.

With the phrase “Gambling-free city” projected on a screen behind him at the Baguio Convention Center, Domogan declared that “gambling is a social menace that will never be welcomed in Baguio.”

“I never condoned vices which require money spent on games of chance,” he said.

“Government should not depend on gambling to get revenues. When [Domogan] said he stands firm against gambling, that is good,” said Baguio Bishop Carlito Cenzon.

The city council has passed a resolution that prohibits the Loterya ng Bayan, a replacement of the government’s Small Town Lottery, from operating.

Domogan described the city’s finances this year as “a measured improvement” to last year’s profits.

The Department of Budget and Management released P450 million this year representing Baguio’s IRA share, he said.

City revenues for 2011 improved with the local treasury collecting P544.581 million from July 2010 to June 30 this year, he said. This was a 15.5-percent increase from the P471.488 million the city government earned from real estate and business taxes from July 1, 2009, to June 30, 2010.

Domogan said the city government had issued licenses to 13,041 business establishments, among them hotels, shopping malls and restaurants.

But he said the government would amend the tax ordinance to include increases in garbage fees and environment-related fees, and put up for lease management various assets like the hydroelectric power plants in Barangay Asin and portions of Burnham Park, to improve city revenues for 2012.

A DBM statement posted on its website alerts local governments to prepare for a smaller IRA share in 2012 because it would be computed against very poor collections in 2009.

The DBM said the IRA for local governments would “decrease by P13.635 billion (or 4.8 percent) to P273.31 billion in 2012 as compared to P286.94 billion in 2011.”  Vincent Cabreza, Inquirer Northern Luzon