Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
SIXTEENTH CONGRESS
First Regular Session

1060

House Bill No.

Introduced by Representative Neptali M. Gonzales II

EXPLANATORY NOTE

This bill seeks to institute reforms in the real estate property
valuation and assessment practices in the Philippines.

Real property is considered the country’s most important and biggest
financial asset, however, the ineffective and inequitable land valuation and
taxation system in the country caused huge losses in revenues, triggered
informal property transactions, and affected the quality of governance,
socio-economic development, and vibrancy of the real estate market in the
country.

Philippine real property market is currently characterized by multiple
systems of valuation appraised by the different National Government
Agencies (NGAs), each using its own system and methodology. The situation
is the same in the appraisal of Local Government Units (LGUs). LGUs
prepare, legislate and implement their Schedules Market Values (SMVs)
which is the basis of the assessment real estate tax. Hence, the same
property is given different values depending on the nature and purpose of
valuation. The process is not insulated from political influence as
manifested, among others, in local officials allowing minimal, selective and
subjective increases on valuations and the frequent deferment of the general
revision of property assessments contrary to the provision of the Local
Government Code requiring revisions every three (3) years. Valuations used
by the LGUs are therefore outdated. The same can be said of valuations
used by the Bureau of Internal Revenue (BIR) since there is no statutory
requirement for it to revise zonal values.


‘The lack of a single agency responsible for property valuations and the
use of multiple appraisal systems have resulted in the lack of uniformity
and equity in real property appraisal in the country. This bill proposes the
establishment of an appraisal authority, the National Valuation Authority
(NVA), that will be responsible in regulating and overseeing the valuation
and appraisal activities of real property in the country. The NVA is
envisioned to maintain the integrity of real property appraisal in the
country. Establishing uniform and internationally-accepted standards for
the valuation of real property in the country and adopting the market value
as a single real property valuation base for the assessment of real property
taxes will address one of the flaws of our current valuation system.
Ensuring equity in real property taxation by separating the valuation and
assessment function from tax setting and political influence is also
imperative.

‘An equitable, creditable transparent and impartial valuation of real
property will result in broadening the taxation base of real property which
will in turn result not only in improved revenue collection but also in foreign
investors’ confidence in the country’s real property market.

In view of the foregoing considerations, approval of this proposed
measure is earnestly requested.

NEPTALI M. GONZALES Il


Republic of the Philippines
HOUSE OF REPRESENTATIVES,
Quezon City
SIXTEENTH CONGRESS,

First Regular Session

1060

House Bill No.

Introduced by Representative Neptali M. Gonzales II

AN ACT
INSTITUTING REFORMS IN REAL PROPERTY VALUATION
AND ASSESSMENT IN THE PHILIPPINES, REORGANIZING
THE BUREAU OF LOCAL GOVERNMENT FINANCE AND
APPROPRIATING FUNDS THEREFOR

Be it enacted by the Senate and House of Representatives of the Philippines in
Congress assembled:

SECTION 1. Short Title. - This Act shall be known as “The Real
Property Valuation and Assessment Reform Act of 2013”,
ARTICLE I
DECLARATION OF STATE POLICY AND OBJECTIVES,
AND DEFINITION OF TERMS

SEC. 2. Declaration of Policy and Objectives. - It is the
policy of the State to promote the development and maintenance of a just,
equitable, impartial and nationally consistent real property valuation based
on internationally accepted valuation standards, concepts, principles and

practices. Towards this end, the State shall:


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(a) Promote the fiscal autonomy of local governments to provide basic
services to their constituency by enhancing their capacity to generate local
revenues from real property;

(b) Establish and maintain valuation standards to govern the valuation
of real property in the country;

(c) Adopt market value as the single real property valuation base for the
assessment of real property-related taxes in the country, and for valuing or
appraising real property for various transactions by all government agencies;

(d) Separate the function of valuing or appraising of real properties from
the functions of tax policy and administering the taxes due thereon;

(c) Support the development and professionalization of the valuation
and appraisal practice in the country pursuant to Republic Act No. 9646,
otherwise known as the “Real Estate Service Act of the Philippines”;

() Provide a comprehensive and up-to-date electronic database of all
real property transactions;

(g) Support the development of a “body of knowledge” on valuation by
continuing research and monitoring of new developments in the valuation
discipline for upgrading the country’s valuation and keeping it abreast with
global developments; and

(h) Ensure transparency in real property transactions to protect the
public and develop confidence in the work of appraisers and assessors.

SEC. 3. Definition of Terms. — As used in this Act, the following

terms shall mean:


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(a) Appraiser refers to a natural person who conducts valuation and
appraisal; specifically, one who possesses the necessary qualifications,
license, ability and experience to execute or direct the valuation and
appraisal of real property; also known as valuer.

(b) Assessor refers to an official in the local government unit (LGU) who
is a licensed appraiser, who performs appraisal and assessment of real
properties including plant, machinery and equipment, essentially for
taxation and other purposes. This definition also includes assistant
assessors.

(c) Building refers to a man-made structure permanently attached to
land for residential, commercial, industrial, recreational or other purposes.

(A) Improvements refer to a valuable addition made to a property or an
amelioration in its condition, amounting to more than a mere repair or
replacement of parts involving capital expenditures and labor, which is
intended to enhance its value, beauty or utility or to adapt it for new or
further purposes.

(c) Land refers to one of the major factors of production consisting
sometimes of a material economic good, which is supplied by nature without
the aid of man. Land may include not only the earth surface, both land and
water, but also anything that is attached to the earth’s surface. Thus, all
natural resources in their original state, such as mineral deposits, wildlife,
timber and fish, are land within the technical meaning of the term; so also
are sources of energy, outside of man himself, such as water, coal deposits

and the natural fertility of the soil.


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(| Machinery refers to machines, equipment, mechanical contrivances,
instruments, appliances or apparatus which may or may not be attached,
petmanently or temporarily, to the real property. It includes the physical
facilities for production, the installations and appurtenant service facilities,
those which are mobile, self-powered or self-propelled and those not
permanently attached to the real property which are actually, directly and
exclusively used to meet the needs of the particular industry, business or
activity and which by their very nature and purpose are designed for, or
necessary to its manufacturing, mining, logging, commercial, industrial or
agricultural purposes.

(g) Market value refers to the estimated amount for which a property
should exchange on the date of valuation between a willing buyer and a
willing seller in an arm’s length transaction (a transaction between
independent, unrelated parties involving no irregularity) after proper
marketing wherein the parties had each acted knowledgeably, prudently and
without compulsion.

(h) Private appraisal sector refers to licensed nongovernmental real
estate service practitioners who have been active in the practice of real
estate appraisal for the last five (5) years.

(i) Real estate refers to the land and all those items that are attached to
the land. It is the physical, tangible entity, together with all the additions or
improvements on, above or below the ground.

() Real property refers to all the rights, interests and benefits related to
the ownership of real estate, plant, machinery and equipment.

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(k) Schedule of Market Values, hereinafter referred to as SMV, refers to a
table of base unit market values for all kinds of real properties, except
machinery, within a local government unit prepared by assessors pursuant
to existing laws, rules and regulations.

()) Special purpose property refers to a property that is designed,
constructed and developed for a specific use or purpose. By its very nature,
this type of property is rarely offered for sale in the open market except as
part of a going concern. Because of the special design and function,
conversion of special purpose properties to other types of development or
application is generally not economically feasible.

(m) Valuation and appraisal refers to the systematic and analytic
determination and recording of property facts, circumstances, investments
and investigation of other relevant data resulting in a supportable estimate
and opinion of value or a professional conclusion based upon supporting
data, logical analysis and judgment as of a specific date and for a specific
purpose.

ARTICLE II
STRENGTHENING THE BUREAU OF LOCAL GOVERNMENT FINANCE
(BLGF)
Chapter 1
BLGF Central Operations

SEC. 4. Role of the BLGF. - The Bureau of Local Government

Finance (BLGF), through the Real Property Valuation Service (RPVS) as

hereinafter established, shall lead and manage the implementation of the


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provisions of this Act. The BLGF shall have the following powers and
functions:

(a) Develop, adopt and maintain valuation standards consistent with
generally accepted valuation standards, regulations and specifications for
real property appraisal used for tax and other purposes, and ensure
compliance therewith by the LGUs and other concerned parties;

(b) Review for compliance with the real property valuation policies and
standards and recommend for approval of the Secretary of Finance the
Schedule of Market Values (SMVs) as prepared by the provincial assessors,
together with municipal assessors and city assessors, including the
municipal assessor in Metro Manila, for tax, both local and national, and for
other purposes;

(c) Provide technical assistance on real property appraisal matters to
government agencies and instrumentalities, and coordinate or conduct the
valuation and appraisal of special purpose properties, when requested;

(a) Provide leadership and policy directions to LGUs on real property
valuation and appraisal for taxation and other purposes, including the
development and maintenance of valuation standards, the regulation of
valuation and appraisal activities and other related matters, and the
promotion of valuation and appraisal training and seminars;

(e) Maintain a roster of licensed local government appraisers and

assessors;


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(), Develop and maintain a comprehensive and up-to-date electronic
database of real property transactions and prices of materials for buildings,
machinery and other structures;

(g) Conduct continuing study and research on valuation, and maintain
an information base on current global and country trends and developments
in real property valuation and appraisal;

(h) Determine, fix and collect reasonable amounts to be charged as
administration fees, fines and penalties relative to the implementation of
this Act; and

(i) Perform such other functions as are necessary, proper and
incidental to implement the provisions of this Act.

SEC. 5. Establishment of the Real Property Valuation Service.
= To achieve the policy and objectives declared in this Act, there shall be
established the Real Property Valuation Service, hereinafter referred to as
the RPVS, within the BLGF.

SEC. 6. Responsibilities of the BLGF Executive Director. -—
The BLGF Executive Director shall be responsible for the efficient and
effective performance of the responsibilities set forth in this Act and for the
overall internal management and governance of the RPVS.

For this purpose, the BLGF Executive Director shall:

(a) Develop and implement policies, plans, programs and operating
standards for the attainment of the objectives of this Act;

(b) Provide policy directions and leadership in all aspects of valuation
and appraisal and their implementation in the regional offices;

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(c) Recommend to the Secretary of Finance the approval of the SMVs
prepared by the provincial assessors, together with municipal assessors,
and city assessors, including the municipal assessors in Metro Manila, for
tax and other purposes;

(d) Advise and assist other government agencies on matters pertaining
to real property valuation and appraisal; and

(e) Perform such other functions as may be provided by law or required
in pursuance of this Act.

SEC. 7. Consultations with Concerned Agencies and Sectors.
= (a) A Central Consultative Committee shall be created, chaired by the
BLGF Executive Director and composed of a representative each from the:

(1) Bureau of Internal Revenue (BIR);

(2) Department of Environment and Natural Resources (DENR);

(3) Bangko Sentral ng Pilipinas (BSP);

(4) National organization of government assessors;

(5) National organization of appraisers in national government
agencies;

(6) Private appraisal sector; and

(7) Union of Local Authorities of the Philippines (ULAP).

(b) The member-representatives from the BIR, the DENR and the BSP
must be performing valuation-related functions. The national organization of
government assessors, the private sector and the ULAP shall be represented

by their respective heads of organizations.


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(c) The Chairperson and members of the Committee shall not receive
additional salary for the performance of their functions. Members of the
consultative committee who are not incumbent government officials or
employees shall be entitled to honoraria, pursuant to existing laws and
regulations.

(d) The Committee shall meet at the initiation of the Chairperson at
least once every semester and shall have as many meetings as the
Chairperson may deem necessary for the adoption of valuation standards.

SEC. 8. Functions of the Central Consultative Committee. —
‘The Central Consultative Committee shall serve as the consultative forum
on matters pertaining to the setting, adoption and maintenance of the
valuation standards.

Chapter 2
BLGF Regional Operations

SEC.9. Role of the BLGF Regional Offices. - ‘The BLGF
Regional Offices, through the Regional Director, shall be responsible for all
matters relating to valuation and appraisal and the SMVs in the region,
such as:

(a) The implementation of the provisions of this Act and related policies,
plans, programs, rules and regulations on real property valuation or
appraisal of LGUs in the region;

(b) Review and endorsement to the BLGF Executive Director of the
proposed SMVs prepared by the provincial assessors, together with the
municipal assessors and the city assessors within the region;

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(c) Provision for economical, efficient and effective service relating to the
implementation of the provisions of this Act in the region;

(d) Coordination and consultation with regional offices of other
government departments, bureaus and agencies within the region dealing
with real property valuation and appraisal;

(c) Provision for leadership and policy direction in the area of real
property valuation and appraisal to LGUs in the region;

() Adoption and maintenance of a comprehensive and up-to-date
regional electronic database of all regional real __property-related
transactions, and have custody of all transaction records submitted by the
local government assessors; and

(g) Performance of other functions as may be assigned by the BLGF
Executive Director.

SEC. 10. The Regional Consultative Committee. —

(a) There shall be a Regional Consultative Committee chaired by the
BLGF Regional Director and composed of a representative each from the:

(1) BIR - Regional Office;

(2) DENR ~ Regional Office;

(3) Regional organization of government assessors;

(4) Regional organization of national government appraisers;
(5) Private appraisal sector within the region; and

(6) Bankers association within the region.

(b)The members of the Regional Consultative Committee must be
performing valuation and appraisal-related functions. Representatives from

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the regional organization of government assessors, private appraisal sector
and banking associations within the region shall be represented by the head
of their respective regional organization.

(c) The Committee shall meet at the initiation of the BLGF Regional
Director at least once every quarter and shall have as many meetings as the
BLGF Regional Director may deem necessary for the performance of its
functions.

SEC. 11. Functions of the Regional Consultative Committee. - The
Regional Consultative Committee shall serve as the consultative forum in
the region for discussion on developments in the local real property market;
concerns of taxpayers, civil society and other stakeholders; outcome of
compliance reporting in the region; level of complaints and appeals; LGU
training in the region; appraisal and assessment concerns in general; and
other matters as may be determined by the Committee

ARTICLE III
VALUATION AND APPRAISAL OF REAL PROPERTIES
Chapter 1
Valuation Standards and Market Values

SEC. 12. Development of Valuation Standards. -
Notwithstanding the provisions of existing laws to the contrary, the BLGF
shall develop, adopt, maintain and implement uniform valuation standards
which shall be used by all appraisers and assessors in the LGUs and other
concerned parties in appraising or valuing lands, buildings, machinery and

other real properties for taxation and other purposes. The valuation

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standards shall conform with generally accepted international valuation
standards and principles.

SEC. 13. Valuation and Appraisal of Real Property. -— For
valuation purposes, all real properties, whether taxable or exempt, shall be
valued or appraised at the market value prevailing in the locality where the
property is situated, in conformity with the valuation standards adopted
under this Act. The BLGF shall promulgate the rules and regulations for the
valuation and appraisal of real property pursuant to the provisions of this
Act. It shall provide leadership in ensuring rationalized valuation of real
properties transcending political boundaries.

For real properties intended for low-cost or socialized housing and other
programs of the government imbued with social policy objectives, the
provisions of existing pertinent laws shall be applied after determination of
the prevailing market value of these properties in accordance with
internationally accepted valuation standards adopted under this Act.

SEC. 14. Preparation of Schedule of Market Values. -
Provincial assessors, together with the municipal assessors and the city
assessors, including the municipal assessors in Metro Manila, shall prepare
the SMVs for the different classes of real property situated within their
respective LGUs, pursuant to the valuation standards, rules, regulations
and other specifications set by the Department of Finance (DOF) and the
BLGF. The said SMVs shall be submitted by the assessor concerned to the
BLGF Regional Office for review and compliance with other requirements not
later than the thirty-first (31%) day of October of the immediately preceding

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calendar year that the general revision of real property assessments was
undertaken. A copy thereof shall be furnished the concerned sanggunian
and the provincial governor or the city mayor, as the case may be.

The said SMVs shall be reviewed by the BLGF Regional Office within
thirty (30) days upon receipt thereof and shall then be submitted by the
same to the BLGF Central Office. Upon the recommendation of the BLGF
Executive Director, the Secretary of Finance shall approve the SMV within
sixty (60) days from receipt of the same; otherwise, said schedule shall be
deemed approved.

The approved SMV shall be transmitted to the concerned assessor who
shall confer with the local chief executive regarding the said approved SMV.
Likewise, the concerned assessor shall submit to the local chief executive a
tax impact report of the new SMV as against the existing assessment levels
and tax rates, and shall provide the sanggunian, through the Chairperson of
the Committee on Ways and Means, a copy of such report. The local chief
executive shall transmit the approved SMV, together with the tax impact
report within fifteen (15) days from receipt of the same to the sanggunian for
the enactment of an ordinance setting the appropriate assessment levels
and tax rates. The concerned sanggunian shall enact such ordinance,
upon conduct of public hearings and proper consultation, within sixty (60)
days from receipt thereof, otherwise, the existing ordinance on assessment
levels and tax rates shall remain in force and effect.

Upon the enactment by the sanggunian of an ordinance for the
assessment levels and tax rates, the local chief executive shall act within ten

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(10) days, in the case of cities and the municipality in Metro Manila, or
within fifteen (15) days, in the case of provinces, to approve the same.
Failure of the concerned local chief executive to act on the ordinance within
the prescribed period shall render the same approved.

‘The approved ordinance, together with the SMV, shall be published by
the concerned LGU in a newspaper of local circulation once a week for two
(2) consecutive weeks: Provided, however, That in provinces, cities and
municipalities where there are no newspapers of local circulation, the same
shall be posted in the provincial capitol, city or municipal hall and in two (2)
other conspicuous public places therein, A list of LGUs whose SMVs have
been approved shall be posted in the BLGF official website.

SEC. 15. Use of Schedule of Market Values. - The SMV, as
approved by the Secretary of Finance, shall be used for the general revision
of real property assessments in LGUs as basis for the determination of real
property- related taxes imposed by national government agencies, and as
benchmark for real property appraisal for other purposes. For purposes of
computing any internal revenue tax, the BIR Commissioner shall adopt the
SMV or the actual gross selling price in consideration, as stated in real
property transaction documents, whichever is higher.

Notwithstanding the provisions of existing laws to the contrary, the

SMV shall cease as basis for the determination of national and local real

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property related taxes after five (5) years from the effectivity of its enacting
ordinance.

SEC. 16. Revision of Schedule of Market Values. - The BLGF
shall formulate the program for the regular revision of SMVs. All provincial
assessors, together with the municipal assessors and the city assessors,
including the municipal assessor in Metro Manila, shall undertake a
revision of their respective SMVs within two (2) years from the effectivity of
this Act. Thereafter, they shall undertake a general revision of SMVs and
property assessments not earlier than three (3) years from the date of the
last revision, but not later than five (5) years.

In case of any significant change in the market where the property is
located after the said SMVs have been approved and prior to its next
revision, or where correction of errors and inequalities in any SMV is
deemed necessary, the provincial assessors, together with the municipal
assessors and the city assessors, including the municipal assessor in Metro
Manila, may recommend to the BLGF Executive Director revisions to their
existing SMV. Such revision/s shall be subject to review by the concerned
BLGF Regional Office and recommendation by the BLGF Executive Director
for approval by the Secretary of Finance within ninety (90) days from the
date of receipt thereof.

SEC. 17. Conduct of Capacity Building Interventions. - For the
effective implementation of this Act, the BLGF shall develop and conduct the
necessary trainings for all local assessors and other local officials/staff on
the preparation of the SMV in accordance with internationally accepted

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valuation standards, concepts, principles and practices; conduct of SMV
impact studies; preparation of compliance reports, and other subject areas
to ensure the effective implementation of this Act.
Chapter 2
Development and Maintenance of Real Property Database

SEC. 18. Development of Real Property Database. - The BLGF
shall develop and maintain an up-to-date electronic database of the sale,
exchange, lease, mortgage, donation and all other real property transactions
in the country and on the cost of construction or renovation of buildings and
other structures, and on prices of machinery. For this purpose, the BLGF is
hereby authorized to require the mandatory submission of necessary
documents from the concerned officials or employees of national government
offices or instrumentalities, LGUs and the private sector. The updated
database shall be made available to the LGUs, national government agencies
and the private sector.

SEC. 19. Duty of Register of Deeds to Supply Assessors of Real
Property Transactions Data. - The Register of Deeds shall prepare and
submit to the provincial and city assessors, including the municipal
assessor in Metro Manila, an abstract of the entire registry every three (3)
months and copies of all contracts selling, transferring or otherwise
converting, leasing or mortgaging real property registered every end of the
month. The abstract shall include brief but sufficient description of the real

properties entered therein, their present owners and the dates of their most

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recent transfer or alienation accompanied by copies of corresponding deeds
of sale, donation or partition or other forms of alienation.

SEC. 20. Duty of Official Issuing Building Permits or
Certificates of Registration of Machinery to Transmit Copy to the
Assessor. - Any public official or employee who may now or hereafter be
required by law or regulation to issue to any person a permit for the
construction, addition, repair or renovation of a building, or permanent
improvement on land, or a certificate of registration for any machinery,
including machines, mechanical contrivances and apparatus attached or
affixed on land or to another real property, shall transmit a copy of such
permit or certification within thirty (30) days of its issuance to the assessor
of the province, city or municipality where the property is situated.

SEC. 21. Duty of Geodetic Engineers to Furnish Copy of Plans
to the Assessor. - It shall be the duty of all geodetic engineers, public or
private, to furnish free of charge, the assessor of the province, city or
municipality where the land is located, a copy of the blue or white print of
each of all approved original subdivision plans or maps of surveys, duly
signed by a Senior Geodetic Engineer, executed by them every end of the
month from receipt of such approved plans from the Land Management
Bureau (LMB), the Land Registration Authority (LRA) or the Housing and
Land Use Regulatory Board (HLURB), as the case may be.

SEC. 22. Duty of Assessors to Transmit Documents to the
BLGF. - It shall be the duty of the assessors to transmit to the concerned

BLGF Regional Office all real property transactions data from the Register of

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Deeds and the names of the official issuing the building permit and those of
the geodetic engineers within one (1) month after the receipt of such data.
‘The BLGF Regional Office shall record, process and make a summary report
of the real property data and submit the same to the BLGF Central office
within one (1) month from receipt of such data.
Chapter 3
Appointment and Qualifications of Assessors

SEC, 23. Appointment of Assessors. — The local chief executive
shall appoint the provincial, city and municipal assessors and the assistant
assessors, as the case may be, in accordance with civil service law, rules
and regulations and the following guidelines:

(a) In the case of provincial and assistant provincial assessors and city
and assistant city assessors, the appointee shall be chosen from the list of
at least three (8) ranking eligible recommendees within the region, as
endorsed by the DOF Secretary as suitable and qualified for appointment;

(b) In the case of municipal and assistant municipal assessors, the
appointee shall be chosen from the list of at least three (3) ranking eligible
recommendees within the province, as endorsed by the DOF Secretary as
suitable and qualified for appointment; and

(c) In the case of city and assistant city assessors and municipal and
assistant municipal assessors for Metro Manila, the appointee shall be
chosen from the list of at least three (3) ranking eligible recommendees
within Metro Manila, as endorsed by the DOF Secretary as suitable and

qualified for appointment.


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‘The assessors shall be under the technical supervision of the BLGF,
primarily through a system of compliance reporting and of capacity-building
programs through education and training.

SEC. 24. Qualifications of Local Government Assessors. - No
person shall be appointed assessor or assistant assessor unless such person
is a citizen of the Philippines, a resident of the region for a provincial or
city assessor/assistant provincial or city assessor and of the province for a
municipal assessor/assistant municipal assessor, a registered and licensed
appraiser, of good moral character and must have experience in real
property valuation or assessment work or in any suitable field for at least
five (5) years in the case of the provincial or city assessor and three (3) years
in the case of the municipal assessor.

All incumbent assessors holding permanent appointments shall enjoy
security of tenure and shall continue to perform their functions without
the need for reappointment and without diminution of status, rank and
salary grade. Those with temporary appointments are given the opportunity
to qualify for permanent appointments as assessors for a period to be
determined by the DOF upon the effectivity of this Act.

ARTICLE IV
PENAL PROVISIONS

SEC. 25. Failure to Comply with the Required Submission of
Documents. - Any government official or employee who fails without
justifiable reason to provide or furnish data or information required
pursuant to Sections 19, 20, 21 and 22 of this Act shall be punished by a

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fine equivalent to the official’s or employee’s six (6) months basic salary or
suspension from the service for a period not exceeding one (1) year, or both,
at the discretion of the competent authority.

SEC. 26. Failure to Comply with the Valuation Standards. -—
An assessor who, for unjustifiable reasons, fails to comply with the
valuation standards developed and adopted pursuant to this Act, or
deliberately conceals any deviation or departure from such standards in the
valuation and appraisal of real property, shall be punished by a fine
equivalent to the official’s or employee's basic salary for a period of one (1)
month to six (6) months, or by suspension from government service for not
more than one (1) year, or both, at the discretion of the competent authority.

SEC.27. Failure to Prepare the Schedule of Market Values. -
An assessor who, for unjustifiable reasons, intentionally or deliberately
refuses or fails to prepare the SMVs within the period set forth in this Act
shall be meted a fine equivalent to the official’s or employee’s basic salary for
a period of one (1) month to six (6) months, or by suspension from
government service for not more than one (1) year, or both, at the discretion
of the competent authority.

SEC. 28. Violations of Other Provisions. - Any person, whether
natural or juridical, who violates any provision of this Act other than those
punishable under Sections 25, 26 and 27 hereof shall, when warranted, be
dealt with under applicable existing laws.

SEC.29. Taxpayers’ Remedies in Case of Erroneous
Assessments of Real Properties. - The provisions of Sections 226 (Local

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Board of Assessment Appeals) and 229 (Action by the Local Board of
Assessment Appeals) of Republic Act No. 7160, otherwise known as The
“local Government Code of 199”, shall apply in all cases of appeals as
remedies for the taxpayers in the assessment of their properties.
ARTICLE V
TRANSITORY PROVISIONS

SEC. 30. Transitory Guidelines. - (a) LGUs which are in the
Process of revising their SMVs, upon the effectivity of this Act, shall continue
with such revisions in accordance with Section 16 of this Act: Provided, That
proper notification and coordination with the BLGF shall be undertaken.

(b)In case the SMV is not yet available or revised, the BIR
Commissioner shall adopt the existing SMV, zonal values or the actual price
in consideration as stated in real property transaction documents,
whichever is higher, for purposes of computing any internal revenue tax.

SEC.31. Saving Clause. - The zonal values, as determined by
the BIR and approved by the Secretary of Finance for internal revenue tax
purposes and the SMVs prepared by the provincial assessors, together with
the municipal assessors and the city assessors, including the municipal
assessor in Metro Manila, that have been approved by their respective
sanggunians for real property taxation purposes shall continue to be in force
and effect until repealed, superseded, modified, revised, set aside or
replaced by the values provided under the new SMVs as approved in
accordance with Section 16 of this Act, which shall be within two (2) years
upon the effectivity of this Act.

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ARTICLE VI
FUNDING REQUIREMENTS

SEC. 32. Budgetary Requirements for the Revision of the SMVs.
~ Each local Sanggunian shall appropriate the necessary funds from locally
generated revenues, the Internal Revenue Allotment (IRA) or such other
sources every fiscal year. The accumulated amount so appropriated shall be
known as the Real Property Tax Administration Fund (RPTAF) which shall
be used for the proper implementation of the regular revision of the SMVs
and the general revision of real property assessments, and the
administration of real property taxes in all LGUs.

SEC. 33. Appropriations. - The amount necessary for the
implementation of this Act shall be included in the annual General
Appropriations Act.

ARTICLE VII
MISCELLANEOUS PROVISIONS

SEC. 34. Implementing Rules and Regulations (IRR). - Within
six (6) months after the effectivity of this Act, the DOF, in consultation with
the concerned parties, shall issue the IRR for the effective implementation of
this Act.

SEC. 35.  Suppletory Application of Existing Laws. - The
provisions of Republic Act No. 7160, otherwise known as the “Local
Government Code of 1991”, and other laws consistent with this Act shall

have suppletory effect.

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SEC.36.  Separability Clause. - Any portion or provision of this
Act that may be declared unconstitutional or invalid shall not have the effect
of nullifying other portions or provisions hereof, as long as such remaining
portions or provisions can still subsist and be given effect in their entirety.

SEC. 37. Repealing Clause. - (a) Sections 19, 135(a), 138, 198(a),
199(g)(h)(l), 201, 202, 209), 212, 214, 218 par. 1(b), 219, 220, 224(a),
443(d), 444(b)(I)(v), 454(d), 455(b)(1)(v), 463(4), 465(b)()(v), 472(a) paragraph
1, 472(b)(8) and 473(a) paragraph 1 of Republic Act No. 7160, otherwise
known as the “Local Government Code of 1991” of the Philippines, are
hereby repealed.

(b) Sections 6(B), 24(D), 27(e)(5), Sections 88(B) and 102 of Republic Act
No. 8424, otherwise known as the “Tax Reform Act of 1997”, are hereby
amended or modified accordingly.

(c) All laws, presidential decrees, executive orders, presidential
proclamations, rules and regulations or parts thereof contrary to or
inconsistent with this Act are hereby repealed, superseded or modified
accordingly.

SEC. 38. —_Effectivity. - This Act shall take effect fifteen (15) days
after its complete publication in the Official Gazette or in at least two (2)
newspapers of national circulation.

Approved,

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