Paris, France – The Bureau of Local Government Finance (BLGF) Executive Director Niño Raymond B. Alvina virtually attended the Session 2 of the Launch Conference of the Third Edition of the World Observatory on Subnational Government Finance and Investment (SNG-WOFI) on 24 October 2022, at the Organisation for Economic Co-operation and Development (OECD) Headquarters in Paris, France, to share the Philippines’ experiences and challenges on strengthening property taxes to enhance subnational government revenue.
In the said conference, Executive Director Alvina discussed the three (3) main motivations for initiating property tax reform in the Philippines, its implementation, and main points for improvement.
“First, property tax offers a sustainable and progressive source of revenues to grow the needed resources and fund the increasing spending requirements of local governments without depending heavily on external sources. Second, from a fiscal decentralization design point of view, local governments are granted the power and authority to use real property taxation for their benefit. But we have seen declining trends in several areas: the collection efficiency of less than 60% of what is due and demandable in aggregate levels and the 8 to 10 percent of LGUs regularly updating property values, which would be addressed through policy and legislative proposals and capacity building. And lastly, we want to build greater trust and confidence in the property valuation by harmonizing the process and methods to conform with the standards and come up with one valuation base for taxation purposes”, Executive Director Alvina said.
He furthered the importance of involving the stakeholders in program design process in a sustainable approach for the success of the property tax reform program.
“We should continue the reform momentum and build the local government capacity and sustain the good systems and practices to strengthen local autonomy and make property taxation work for all”, ED Alvina added.
The Local Governance Reform Project (LGRP), a four-year loan project funded by the Asian Development Bank (ADB), aims to improve local government revenue mobilization to upscale local public service delivery and strengthen local governance.
The SNG-WOFI is a joint venture by the OECD and United Cities and Local Governments (UCLG) with the goal of increasing knowledge and promoting dialogue among national and subnational governments, international organizations, and stakeholders on subnational finance around the world through collection and analysis of standardized qualitative and quantitative data.
The 2022 edition presents key findings from the data and analysis from 135 countries, covering almost 90% of the world surface area, 93% of the world population, and 94% of global GDP, which discuss current challenges on subnational finance and multi-level governance.