Probe: Cebu City’s property tax increase ‘grossly illegal’

Local

AN INTERNAL investigation by the Cebu City Legal Office (CCLO) has uncovered what it described as a “grossly illegal” scheme that led to unauthorized increases in property tax assessments through an override system.

The sweeping legal report, approved by City Attorney Santiago Ortiz Jr. and outlined in SP Resolution No. 16-3957-2025, found that between 2022 and 2023, market values in the city’s computerized Real Property Tax System (AS400) were altered based on owner-declared values, bypassing the official valuation process required by law.

At the center of the controversy is an “override” function introduced into the system, allegedly under pressure from former Acting City Treasurer and Fiscal Reforms Assistant Lawyer Jerone Castillo and former City Assessor Dr. Maria Theresa Rosell.

The override allowed system-generated values, normally based on ordinances approved by the City Council and Bureau of Local Government Finance (BLGF) guidelines, to be replaced with figures declared by property owners themselves.

“The City can no longer afford to turn a blind eye to the systemic fraud harming its taxpayers. Ignoring this injustice only empowers those who seek to exploit the system, relying on the neglect and inaction of those sworn to protect the public interest,” wrote Lawyer Luigine Christi Chan, Attorney III, who led the investigation.

Unlike values derived from official schedules approved by the Sanggunian, owner-declared figures are not verified and were never intended to be used as the basis for tax computation.

As a result, tax declarations reportedly spiked, some by over 1,000 percent, without due process or formal legislative approval, placing a significant and unjust burden on property owners.

The CCLO flagged this as a violation of the Local Government Code, which mandates that property market values for taxation must be enacted through a formal ordinance.

The report said this illegal practice not only compromised taxpayer rights but also exposed the city to potential administrative and legal liability.

The report further warned that many property owners were unaware of the inflated assessments and missed the 60-day window to appeal to the Local Board of Assessment Appeals (LBAA). Others withheld payment in protest but had no legal remedies.

“To leave such irregularities hidden and unresolved would undermine the principles of accountability, transparency, and justice that form the foundation of good governance,” the legal office emphasized.

Among the recommendations in the CCLO report are the immediate nullification of all tax declarations based on the override scheme; the reassessment of properties using legally approved values, effective 90 days after the override assessments are invalidated; and executive actions to assist affected taxpayers, especially those who missed the appeal period.

The report also advises the creation of help desks and public information campaigns to explain the issue, the enactment of legislation to formally declare override-based assessments void from the beginning, and an investigation into the administrative and criminal liability of those responsible.

The override mechanism, allegedly triggered by verbal orders and even post-it notes, reportedly clashed with internal safeguards and caused friction within the city’s Management Information and Computer Services (MICS).

The MICS head was among those relieved pending further probe.

The CCLO acknowledged that refunding taxes collected under the override system would be legally complex, as funds have already been distributed across city programs and barangays.

“The City can no longer afford to turn a blind eye,” the report concluded, quoting Franklin D. Roosevelt: “The only thing necessary for the triumph of evil is for good men to do nothing.”

In response to the report, Councilor Jose Abellanosa on Tuesday, July 15, filed a corollary motion during the 17th Sangguniang Panlungsod’s regular session to refer the matter back to the City Assessor’s Office.

He also moved to formally require the Assessor’s Office to notify all real property owners and issue a public notice clarifying that no increase in assessed values is valid unless approved by the Sanggunian and officially published through an ordinance.

The motion seeks to prevent further misinformation, especially as affected taxpayers continue to face the consequences of inflated assessments.(TGP)