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DISTRIBUTIONAL IMPACT STUDY & C O M P O N E N T 4 . 1 B 4. Data requirements 2. Scope of the study 5. Use of the study 1. Objectives of the study To assess compliance in the payment of property taxes To recommend measures to improve property tax compliance To introduce greater equity in the distribution of the tax burden among taxpayers OBJECTIVES OF THE STUDY Examine compliance in the payment of property taxes covering the most recent completed tax year SCOPE OF THE STUDY
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C O M P O N E N T 4 . 1 B
PROPERT Y TA X
COMPLIANCE
DISTRIBUTIONAL
IMPACT STUDY&
P R E S E N T A T I O N O U T L I N E
1. Objectives of the study
2. Scope of the study
3. Methodology
4. Data requirements
5. Use of the study
O B J E C T I V E S O F T H E S T U D Y
To assess compliance in the payment of property taxes
To recommend measures to improve property tax compliance
To introduce greater equity in the distribution of the tax burden among taxpayers
S C O P E O F T H E S T U D Y
Examine compliance in the payment of property taxes covering the most recent completed tax year
M E T H O D O L O G Y
TAX GAP APPROACH
Compliance rate = Actual Collection x 100Potential Tax
where
Actual Collection = Current year’s collectionPotential Tax = Tax Collectible
= Total Assessed Value x Tax Rate
M E T H O D O L O D Y
Cleaning and Matching of Assessment and Collection Reports for each RPU (or sample RPUs)
Data Processing Data Analysis
M E T H O D O L O G Y
The study involves the following:1. Review of local legislation2. Analysis of overall LGU performance in RPT collection3. Establishing appropriate strata of property values4. Analysis of tax delinquencies5. Analysis of tax discounts6. Formulate recommendations to improve tax compliance
PROPERTY TAX COMPLIANCE & DISTRIBUTIONAL IMPACT STUDY
data requirements
D A T A R E Q U I R E M E N T S
ASSESSOR’S OFFICE
1. Property Assessment Roll (complete, updated, computerized)
2. Summary of Real Property Assessments
D A T A R E Q U I R E M E N T S
TREASURER’S OFFICE
1. Daily report of basic RPT & SEF collection (complete, computerized)
2. Statement of Revenue/Income & Expenditures3. Breakdown of Collection from Basic RPT & SEF4. List of Properties Enjoying RPT Incentives/
Exemptions5. Collection from delinquent taxes & amount of
discounts
PIN TDN Ow-
ner
Brgy Class
(sub-
class)
Typ
e
Tax
abili
ty
(T/E)
Area
(in
SqM)
Unit
Value
Marke
t
Value
Asses
sed
Value
Asse
ssm
ent
Leve
l
Tax
Rate
Est.
Tax
Due
EXAMPLE
20
01
-11
-
04
73
-1
Sia,Ram
on
Del
Ro
sario
THE DATA: COMPUTERIZED ASSESSMENT ROLL
ROLL
Date Name
Tax Dec
#
OR #
Brgy Class Basic RPT SEF Tax Total Net Coll.Cur
rent Yr
Disc Prior Yr/s
Penalties Current Yr
Disc Prior Yr/s
Penalties
CurrentYr
Prior Yr/s
CurrentYr
Prior Yr/s
EXAMPLE
01
/13
/20
09
Sia,Ram
on
20
01
-11
-04
73
-1
12
34
56
Del R
osario
Co
mm
ercial
48
,75
0
(4,8
75
)
5,0
00
0 2,0
00
39
,00
0
(3,9
00
)
4,0
00
0 1,5
00
91
,47
5
THE DATA: DAILY RPT RECORD
1. Determine the assessment year or the effectivityyear of the Assessment Roll
2. Check for duplicated entries, and make sure there is only a single (unique) entry
3. Check whether all important fields are filled, e.g., TDN, land area, property sub-class, market values, assessed value, etc.
DATA CLEANING: ASSESSMENT ROLL
4. Ensure that the text format of the Tax Declaration Number (TDN) is similar for all entries -> establishes the link between the assessor and treasurers’ data
5. Take note of properties with 0% assessment, e.g., residential buildings with MV of 175,000 and below; AND those that are tax-exempt, e.g., “government properties”
DATA CLEANING: ASSESSMENT ROLLDATA CLEANING: ASSESSMENT ROLL
1. Make one entry for all real property units (RPUs) paid on installment basis -> get the total payment
2. Ensure that the text format of the Tax Declaration Number (TDN) is similar for all entries -> establishes the link between the assessor and treasurers’ data
DATA CLEANING: DAILY RPT RECORDDATA CLEANING: DAILY RPT RECORD
D A T A P R O C E S S I N G
SUMMARY TABLES
1. RPT Compliance by Property Stratum: 20082. RPT Compliance by Property Classification: 20083. RPT Compliance by Barangay: 20084. Dist. of the RPT Collection by Property Stratum: 20085. Dist. of the RPT Collection by Property Classification:
20086. Dist. of the RPT Collection by Barangay: 2008
D A T A P R O C E S S I N G
SUMMARY TABLES
7. Advance and Prompt Payments by Property Stratum: 2008
8. Advance & Prompt Payments by Property Classification: 2008
9. Advance & Prompt Payments by Barangay: 200810. Tax Delinquencies by Property Stratum: 200811. Tax Delinquencies by Property Classification: 2008 12. Tax Delinquencies by Barangay: 2008
D A T A A N A L Y S I S
1. Analysis of RPT Compliance Rate, By Property Classification
Residential Commercial Industrial Agricultural
D A T A A N A L Y S I S
2. Analysis of RPT Compliance Rate by Property Stratum Low-value Property Medium-Value Property High-Value Property
3. Analysis of RPT Compliance Rate by Barangay (or municipalities in case of province)
D A T A A N A L Y S I S
4. Analysis of Distribution of RPT Collection By Property Classification By Property Stratum By Barangay (or municipalities in case
of province)5. Analysis of Tax Discounts, Tax
Delinquencies6. Analysis of Over-all LGU Performance in
RPT Collection
PROPERTY TAX COMPLIANCE & DISTRIBUTIONAL IMPACT STUDY
uses of the study
U S E S
Basis for estimating revenue impact
Guide to local council members
Tool to determine the weaknesses of current tax enforcement processes & procedures
THANK YOU!