COVID-19 relief: LGUs told to extend local tax deadlines to June 25

All local government units (LGUs)—provinces, cities, municipalities and barangays—have been ordered to extend until June 25 the deadline for payment of all taxes, fees and charges that were due during the COVID-19 lockdown period.

The order was given by the Department of Finance (DOF) through a circular issued by Finance Secretary Carlos G. Dominguez III on April 23.

Prior to this, LGUs decided among themselves if they shall extend deadlines or not in consideration of the enhanced community quarantine (ECQ) imposed on Luzon and other parts of the country since mid-March.

Based on monitoring by the DOF’s Bureau of Local Government Finance (BLGF), 146 LGUs had extended deadlines to pay local taxes, fees and charges due to the pandemic.

Dominguez told Local Government Secretary Eduardo M. Año that extending local tax deadlines was provided for by the Bayanihan to Heal as One Act.

Dominguez told Año, who has jurisdiction over LGUs as local government secretary, that the DOF circular would allow “uniform” enforcement of the deadline extension.

When LGUs were left to decide on tax deadlines, Dominguez said it led to “lack of uniformity.”

This, Dominguez said, “defeated the purpose of relevant community quarantine orders.”

The DOF circular said the June 25 extended deadline applied to “all local taxes, fees and charges” being collected by LGUs.

The clock stops ticking for the deadlines, according to the circular.

If an LGU had already extended tax deadlines prior to the Bayanihan law, such would be “deemed modified,” the circular said.

During the extension period, the DOF said, “no interest, surcharge or any form of penalty shall be applied” to delayed tax payments.

Interest or penalties would, however, start to accrue starting on the day of the extended deadline, the circular said.

Local treasurers and assessors were also ordered to defer issuance of orders to examine books of accounts and other business records until after the June 25 deadline.

Actions barred during the period also included appraisal or assessment of real property, posting delinquency notices, issuing warrants of levy, sale or auction of seized assets and pursuing judicial action for tax or fee collections.

Dominguez said he, as DOF chief, exercised his power to reschedule tax payments of LGUs as mandated by the Bayanihan law.

Such mandate was also given to Dominguez by a March 28 memo from Executive Secretary Salvador C. Medialdea.

BLGF Executive Director Niño Raymond B. Alvina earlier explained to the Inquirer that provinces, cities, municipalities and even barangays have different taxing powers and collect taxes separately.

In 2020, provincial, city and municipal treasurers had been tasked with collecting P307.1 billion in revenues.

Edited by TSB