The ordinance, approved by the council last week, requires property owners and developers to submit to the city documents like service and supply contracts with their contractors, list of materials and suppliers, and contracts with subcontractors.
The documents will be required in getting building, occupancy and other permits from City Hall.
The author of the ordinance, councilor Nestor Archival, said the measure is two pronged: One is to encourage developers to hire Cebu City-based contractors; and two, for the City Treasurer’s Office to properly assess development as basis for the collection of real-property tax.
“We are creating a system where the Office of the Building Official [OBO] and the city treasurer have the same records,” Archival told the BusinessMirror. “This will ensure that developers and contractors will be honestly declaring their projects and they will be properly taxed.”
Archival said many contractors working on the city are actually from other cities and are just hiring subcontractors here. With the ordinance, the city government will be able to properly impose taxes on the developers who will, in turn, be encouraged to hire city-based contractors.
Underdeclaration of incomes by contractors will be caught when their projects seek for occupancy permits—which will reflect the magnitude of the projects they worked on. Developers cannot also underdeclare their developments as this will be cross-checked with documents from the contractor.
Archival said the ordinance will not create another layer of red tape as the documents required by the OBO and the treasurer must already be ready before projects start and the city is only asking for a copy.
The ordinance is also not meant to impose another layer of tax as the city is only relying on old tax codes and rates. The city treasurer and the OBO are only streamlining their process to be more efficient.
Source: Business Mirror
