Reforming the Real Property Tax System of Nueva Vizcaya
Nueva Vizcaya
2002
The landlocked province of Nueva Vizcaya used to have perennial headaches in collecting property taxes and raising revenues. About two-thirds of the province are mountainous, and 90% of taxable properties are exempted because their value is below P100,000.
With so little to collect and so much effort to spend, the provincial government ended up subsidizing its tax collection drive. For every peso it collected, it spent P1.36. Tax forms were voluminous and turned off many prospective taxpayers.
The local government knew it had to adopt a creative approach in collecting real property taxes that would address these concerns.
Local government officials believed that an informed taxpayer is a good taxpayer. It thus obtained the support of barangays (which are also beneficiaries of real property tax collections), schools, parent-teacher associations, and other affected individuals and organizations. Regular radio broadcasts were used to inform taxpayers on filing dates and other activities.
The local government created a Real Property Tax-on-Wheels system, where a representative from the provincial assessor’s office and the provincial treasurer went out on field to collect. The door-to-door service includes the entire process – from appraisal down to collection – and was extremely convenient for local taxpayers. The provincial assessor devolved his authority to six municipal assessors, making the program fast and efficient.
By the end of 2001, the cost of collecting real property taxes went down to 87 centavos from P1.36 per peso collected. As a result, real property tax collections rose dramatically from P4.08 million in 1995 to P7.57 million in 2001. Tax delinquency plunged to 12% from 32%.
This program is recognized as a Trailblazing Program, a finalist for the 2002 Galing Pook Awards.