Makati collects P8-B revenue from local sources in January, hits 56% of full-year target

March 18, 2018 - 10:56 AM
Another high rise under construction in Makati City, the financial district. (Reuters file photo by Romeo Ranoco)

MANILA, Philippines – Makati, the country’s premier business district, collected total revenues of over P8 billion in January from local sources, a sum that already represents 56 percent of the full-year target, the Office of the City Treasurer reported.

Makati Mayor Abby Binay said that with this, the city was “off to a good start” this year.

“With major initiatives of the city now well under way or set for implementation this year, increased revenue collection is certainly welcome news to us. It means we can confidently proceed with our plans for the year,” Binay said.

Acting City Treasurer Jesusa Cuneta also cited in her report an 8-percent increase in collection over the same period last year from locally-sourced revenues, which include business tax, real property tax, fees and charges, and economic enterprises.

The mayor said the increased revenue collections can be attributed to more efficient processes at City Hall as well as to renewed investor confidence.

“Aside from our proactive collection efforts, we can credit our healthy revenue growth to improved processes at City Hall which have made transactions more convenient and transparent, thus inspiring stronger investor confidence,” the mayor said.

Records of the city Business Permit Office (BPO) show an increase in new business registrants and renewed business permits in the first month of the year compared to January last year. From 125, the number of new businesses grew to 243, while renewed permits rose from 29,225 to 31,311. The combined investment capital of new businesses has been estimated at P1.5 billion.

Based on the Treasurer’s report, business tax earned the highest revenue with P4.1 billion (46 percent attainment rate), which is 7 percent higher than collection in January 2017.

The next highest income came from real property tax with almost P3.6 billion (78 percent attainment rate), showing a 9-percent increase versus last year.

Other local sources include fees and charges with P313.2 million or 49 percent of target, and 9 percent higher; and economic enterprises with P15.8 million or 7 percent of target, and 33 percent higher than last year.

Meanwhile, the city has earned P27.7 million in interest income or 17 percent of target, and received P94.8 million or nine percent of its estimated Internal Revenue Allotment (IRA) from the national government. Unlike many local government units, Makati is not dependent on the IRA.

Total revenue collections of the city as of January from both local and external sources amounted to P8.12 billion, or 52 percent of gross revenue target for the year.

Meanwhile, the Treasurer’s report also showed the city to be on track with the higher revenue targets set by the Bureau of Local Government Finance (BLGF) under the Department of Finance.

Based on the BLGF performance target for Makati for fiscal year 2018, the city has attained 47 percent of total estimated income from local sources for the year as of January 31, 2018. Collections from realty tax reached 53 percent of target, followed by business tax at 45 percent attainment rate.

In 2017, the city posted a two-digit increase in revenue collections for the first time in about 12 years. Its gross revenue collections reached P16.97 billion or 116 percent of its full-year target and 12 percent more than the 2016 collections.

Business tax remained the top revenue source with P8.22 billion followed by real property tax with P6.22 billion, posting an increase of 10 percent and 15 percent, respectively.