Timing of tax hike on banking sector not good, says CBC

WITH the amendment of the Cebu City Omnibus Tax Ordinance, banks, insurance firms and other financial institutions in the city can expect a higher tax rate.

But now may not be a good time to do that, considering the impact of the coronavirus disease (Covid-19) outbreak on local businesses.

“Given the scenario right now, with the Covid-19 issue, we saw some businesses slowing down and in the coming months, we have yet to see the full impact of the Covid-19. So with the increase of the gross receipt tax to about 75 percent, this is quite untimely since business is slowing down,” said Neil Yu, president of the Cebu Bankers Club (CBC).

Yu cited the drop in economic activity in Cebu because of dwindling tourist arrivals caused by travel restrictions.

However, he also welcomed the move, saying Cebu City has been growing over the years.

“It is the inherent power of the local government unit to collect tax from all businesses and by the provision of the law, the City of Cebu can impose a maximum of 75 of one percent given that Cebu is a highly urbanized city,” he said.

Section 46 of the current tax ordinance charges financial institutions 50 percent of the one percent of their gross receipts for the preceding calendar year.

“With that, the existing 50 percent of one percent is indeed only applicable to municipalities so in this case, we just have to support the approved resolution of the City Council,” Yu said. “The revenue that they can get from this would somewhat help the City to improve further their services to the general public.”

As the CBC pointed out, the economic impact of Covid-19 remains to be seen. But with Sen. Christopher “Bong” Go saying on Saturday night, March 7, 2020, that President Rodrigo Duterte declared a state of public health emergency following the first confirmed case of local transmission of Covid-19, it can only get worse before it can get better.

The declaration means stricter implementation of quarantine, whether at home or in holding facilities throughout the country.

Cebu City Health Officer Daisy Villa said that even before the Department of Health (DOH) declared Code Red Sub-Level 1, her office has been preparing for this scenario.

“There are comments that why is it that we are so strict in Cebu when it comes to the implementation of this home or facility holding areas, so we have to explain to them the importance of doing it,” she said.

She said the Cebu City Resource Management and Development Center building in Barangay Taptap is ready to serve as a quarantine facility for persons under monitoring (PUMs), who are city residents.

Villa said health agencies, together with the DOH 7, will meet on Monday, March 9, to discuss the matter.

City Councilor Dave Tumulak, committee on disaster risk reduction and management chairman, said the City’s health responders underwent ambulance service training conducted by the health department. But this is no guarantee that the virus will not spread, he said.

In Mandaue City, nine PUMs, who recently arrived from Hong Kong, have been put under a 14-day home quarantine. They will be monitored by members of the barangay health emergency response team (BHERTs), according to Mandaue City Health Officer Marie Ouano Tirado.

Tirado said there are no positive cases of Covid-19 in the city.

She said she will order BHERTs to intensify their monitoring of PUMs and to coordinate with barangay officials, schools and local police.

She admitted that they will have a hard time keeping up with the contact tracing if local transmission is confirmed in Cebu.

In light of the recent development, Tirado encouraged those who have a fever or a cough who have no travel history to countries with Covid-19 cases to go to the nearest health center or hospital for a checkup.

She also encouraged the public to heed the DOH’s preventive measures to avoid the spread of the virus.

Tirado hopes the DOH won’t raise Code Red to Sub-Level 2, as this will entail the suspension of work and classes.

The DOH raised Code Red Sub-Level 1 on Saturday, March 7, after it confirmed three new cases of Covid-19.

Code Red, according to Health Secretary Francisco Duque III, is a preemptive call to ensure that national and local governments and public and private health care providers can prepare for possible increase in suspected and confirmed cases.

The fifth and sixth cases in the country, a couple, are considered cases of local transmission because they have no history of travel.

The fifth case, a 62-year-old Filipino male, is in critical condition at the Research Institute for Tropical Medicine.

He had infected his wife, 59. The couple lives in Cainta, Rizal.

The fourth case is a 48-year-old Filipino employee of Deloitte at its Philippine office in the Bonifacio Global City. He has a history of travel to Japan.

With the new three cases, Philippines now has six cases of Covid-19.

The first three cases involved Chinese tourists, including one who died. The two others have since returned to China. (JOB / JJL / KFD)