Manila suffers from unliquidated cash advances and poor property tax collection – COA – Manila Bulletin


Manila Mayor Francisco “Isko Moreno” Domagoso has inherited a ton of headaches from former city rulers that include nearly 200 million pesos in unliquidated cash advances, insufficiently protected rental contracts, and underprotected real estate units. -valued which resulted in a shortfall on property taxes, the Commission on Audit (COA) revealed.

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However, during the exit conference with the COA audit examiners, Domagoso’s office revealed that state auditors have only scratched the surface of irregularities committed by former city administrators.

The current city administration said billions of pesos in property taxes had not been collected by the city’s former mayors.

Worse yet, his predecessors did not take the appropriate steps available to the city government to collect the correct taxes from the city landowners.

In the 2019 annual audit report for Manila, the COA found that 670 real estate units in the sample were dumped, resulting in “a property tax shortfall of approximately 9.686 million pesos. For the only year in question.

COA said that based on the data they collected, the city government underperformed in collecting property taxes last year. Domagoso began his administration in Manila on June 30, 2019.

State auditors said gross collections of RPT and special education taxes from 2014 to 2019 averaged 5.138 billion pesos per year and peaked in 2017 at 5.660 billion pesos.

“The city has yet to return to this all-time high at the end of 2019, as collections amounted to 5.424 billion pesos or 236 million pesos below the high level.

“Based on this data, the city underperformed in 2019,” the COA said in ordering the city government to improve the collection of TCNs for current and delinquent categories.

At the exit conference, the city treasurer pledged to collect and auction off real estate units from delinquent taxpayers as soon as all necessary measures have been taken by the city.

According to the incumbent municipal administration, billions of pesos were not collected before Domagoso’s tenure as the city’s executive.

“The city had not paid cash advances totaling 203.440 million pesos, of which 198.791 million pesos or 97.7 percent were drawn by and are responsibilities of previous municipal governments,” he said. also reported the COA.

State auditors found that 133.79 million pesos in cash advances had not been recorded for more than a year, while other cash advances remained to be accounted for in 1995 when the money has been withdrawn from the city coffers.

Former city officials have also been blamed for the mismanagement of rental contracts which resulted in inadequate protection of the city’s interests with respect to the properties it leased.

The city government has leased a total of 427 real estate units which include residential lots, real estate and office space and underpass stalls.

Of these leased units, 416 are not covered by “valid contracts / agreements”.

On the other hand, the lease contracts concluded by the municipality and the tenants did not provide for a standard penalty clause which should have guaranteed the payment of the rent on time.

The auditors also observed “an excessive delay in the payment of the rent”.

“In particular Oceanville Hotel and Spa Corp. has not paid any rent since January 2014, when the lease contract was signed, ”reveals the audit report.

“The evaluation of the city’s lease management revealed that it had been poorly managed by previous municipal governments,” the COA said.

The city’s general service office said it has started implementing a system for periodically reporting and reconciling rental records. In addition, it also issued notices of default to defaulting tenants.




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