So far, a total of between 20 and 25 licenses have been reviewed by the Finance Department of the Yaiza City Council, in relation to the payment of taxes and fees for construction, installations and works, and the tax differential to be paid results in about five million euros that had not been paid by the developers because the real value of the work was not updated after its completion. A procedure that, according to Leonardo Rodríguez, "is the first time it has been applied in the Yaiza City Council."
Currently, the southern City Council is carrying out a review through which developers and builders are being required to provide all information that can prove the real value of the work (from the complete insurance policy, documentary proof of expenses, and certification of origin of the works issued by the contractor). Thus, Leonardo Rodríguez has assured that the Finance Department has the opportunity to "request a supplementary review of the license, which corrects the value of the first one granted and updates the license to the real budgets of the work".
In addition, the councilor emphasized that "it is not a new tax, nor has the tax been raised, nor will it be increased on those constructions that are being done now. These are taxes that affect constructions that are finished, and in most cases also sold, and what is demanded from the developers is that they pay what they have to pay for what was built, just as a neighbor pays their municipal taxes.
Likewise, Leonardo announced that "this amount will increase as we review all licenses from 2004 to 2008", since, he says, they have started with those from 2004 "so that they do not expire and we do not miss the claim of the amounts". Regarding the percentage of these licenses, Rodríguez assured that "we cannot advance the percentage because we have not had time to review all the licenses, but surely the amount will be greater than 5 million".
The procedure applied when a developer requests a license, according to Leonardo Rodríguez, begins with the presentation of the project of the work and a budget for it. And from this budget, the City Council charges 5 percent of that value between taxes and fees. Once this provisional settlement is made and this amount is paid, when the work is finished, the City Council verifies that the value of the execution of that work corresponds to the provisional settlement made at the beginning. "A value that in almost no case coincides", according to Rodríguez.
REAL CASE
To make the situation clearer, the councilor gave the real example of a developer who requested in 2005 the construction of a property in which it was declared that it would cost 12 million euros. At the end of the work, according to Rodríguez, "this City Council verifies that the real value of that execution is 36 million euros. Three times more than what was budgeted. Therefore, the difference is 24 million euros and will have to be taxed for this amount, which represents, calculating it at 5 percent, a total of 1,200,000 euros."
Thus, although the example is one of the "most significant and most substantial", according to Rodríguez, "the fact is that added together, all of them, as of today, and with the short period of time that we have been working in the collection department, we can add an amount of 5 million euros that the City Council is in a position to collect in the coming times. For licenses and for the completion of works from 2004 to the present."
