FOURTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
1 
Second Regular Session 
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S E N A T E  
S.B. No. :j 2 2 9 
Introduced by Senator Miriam Defensor Santiago 
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EXPLANATORY NOTE 
The Local Government Code of 1991 provides power for each local government 
unit to create its own sources of revenue and to levy taxes, fees, and charges subject to 
the provisions in the Code, consistent with the basic policy of local autonomy. These 
taxes, fees, and charges shall accrue exclusively to the local government units. 
Despite the enactment of this Code, the revenues collected by the various units are 
not enough to fund their local projects. This hill seeks to increase the additional ad 
valorem tax on idle lands from a ceiling of more than 5% to 10% which could result in an 
increase in annual collection from 12.8 million pesos to 25.6 million pesos. There is also 
a need to provide an additional levy of 0.5% for the Special Education Fund (SEF) which 
could result in an increase from 2 billion pesos to 4 billion pesos. 


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FOURTEENTH CONGRESS OF THE REPUBLIC) 
9 ivly 12 p2 :?o 
OF THE PHILIPPINES 
1 
Second Regular Session 
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S E N A T E  
S.B. N o . 3 2 2 9  
Introduced by Senator Miriam Defensor Santiago 
AN ACT 
AMENDING TITLE 11, BOOK I1 OF REPUBLIC ACT 7160, OTHERWISE KNOWN 
AS THE LOCAL GOVERNMENT CODE OF 1991 
Be it enacted by the Senate and the House of Repyesentatives of the Philippines in 
Congress assembled: 
SECTION 1. Section 235 of the Code is hereby amerrled to read as follows: 
SEC. 235 Additional Levy on Real Property for the Special Education Fund 
(SEP). A province or city, or a municipality within the Metropolitan Manila Area, may 
levy and collect an annual tax of [one percent (I%)] ONE AND ONE HALF PERCENT 
(1 %%) on the assessed value of real property IN THEIR RESPECTIVE TERRITORIAL 
JURISDICTION [which shall be] in addition to the basic real property tax PROVIDED 
UNDER THIS CODE. The proceeds thereof shall exclusively accrue to the Special 
Education Fund (SEF). 
SECTION 2. Section 236 of the Code is hereby amended to read as follows: 
SEC. 236 Additional Ad Valorem Tax on Idle Lands. A province or city, of a 
municipality within the Metropolitan Manila Area, may levy an annual tax on idle lands 
at the rate not exceeding [five] TEN percent [(5)] (10) of the assessed value of the 
property which shall be in addition to the basic real property tax. 
SECTION 3. Section 272 of the Code is hereby amcnded to read as follows: 
SEC. 272 Application of Proceeds of the [Additional One Percent] SEP Tax. 
The proceeds from the additional [one percent (l%)] ONE AND ONE HALF PERCENT 
(1%%) tax on real property accizring to the Special Education Fund (SEF) OF THE 
PROVINCE, CITY OR MUNICIPALITY WITHIN THE METROPOLITAN MANILA 


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AREA shall be automaticalIy released to the local school boards; Provided, however, 
That in the case of provinces, the proceeds shall be divided equally between the province 
and the municipal school boards; Provided, however, That the proceeds shall be allocated 
for the operation and maintenance of public schools, construction and repair OR 
IMPROVEMENT of PUl3LIC school buildings, 
AND/OR RELATED facilities and 
equipment, educational research, purchase of books and periodicals, HONORARIUM 
FOR TEACHERS CONDUCTING EXTENSION CLASSES and sports development as 
detelmined and approved by the Local School Board. 
SECTION 4. Separability Clause. - If any provision or part thereof is held invalid 
or unconstitutional, the remainder of the law or the provision not otherwise affected shall 
remain valid and subsisting. 
SECTION 5. Repealing Clause. - All laws, presidential decree or issuance, 
executive orders, letter of instruction, administrative order, rule and regulation contrary 
to, or inconsistent with the provisions of this Act are hereby repealed, modified, or 
amended accordingly. 
SECTION 6. Effectivity Clause. - This Act shall take effect fifteen (15) days 
following its publication in at least two (2) newspapers of general circulation. 
Approved,