Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
NINETEENTH CONGRE S S
First Regular Session
HousEj|LLNo.   5241
Introduced by REPRESENTATIVE JONATHAN KEITH T. FLORES
EXPALANTORY NOTE
The proposed bill aims to promote the development of ajust, equitable, and efficient
real property valuation system.   The reform shall broaden the tax base for real property-
related taxes of national and local governments, thereby improving tax collections without
increasing the existing tax rates or imposing new taxes.
Moreover, the bill shall address the following systemic problems:
a.   Rampant  outdated  valuations  used  for  governmental  purposes,  especially  for
national and local taxation;
b.   Cost   overruns   and   foregone   revenues   due   to   low   valuation   used   (i.e.,
overvaluation   when   government   pays,   undervaluation   when   government
collects);
c.   Valuation as a political issue;
d.  Multiple, overlapping valuations of different government agencies;
e.   Absence   of  a   single   agency   responsible   for   ensuring   that   valuations   are
completed in accordance with intemational standards; and
f.   Absence of a comprehensive real property electronic data base.
By improving the quality of valuation of local governments and making the revision
frequent, efficient, transparent, reliable, and attuned to market developments, the proposed
valuation  reform  shall  have  a  favorable  impact  on  revenue  generation  and  resource
mobilization of local governments to fund their service delivery requirements.  The reform
shall also foster private investor confidence and build the public's trust in the valuations
of government.


Under the proposed bill, the Bureau of Local Government Finance (BLGF), through
the Real Property Valuation Service (RPVS) shall be responsible for the implementation
of the reform.
In view of the foregoing, approval of this bill is eamestly sought.
2


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
NINETEENTH CONGRES S
First Regular Session
HousE i;ILL No.  52 41
Introduced by REPRESENTATIVE JONATHAN KEITH T. FLORES
AN ACT
INSTITUTING    REFORMS     IN    REAL     PROPERTY    VALUATION    AND
ASSHSSMENT  IN  THE  PHILIPPINES,  REORGANIZING  THE  BUREAU  0F
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  A+ct  sheul  be  hewn  a;s  the  "Real  Property  Valuation  and
Assessment Roform Act."
ARTICLE I
DECLARATION OF POLICY AND OBJECTIVES, AND DEFINITION OF TERMS
S'EC.   2.  Dcc/czrcr/jo#  o/ Po/J.c);  CZJ?cJ  Objecz/.`;e5'.  -  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:
(a) Establish and maintain standards to govern the valuation of real property in the country;
(b) Adopt market value as the single real property valuation base for the assessment of real
property  related  taxes  in  the  country,  and  for  the  valuation  of real  property  for  various
transactions by all government agencies;
(c) Promote the fiscal autonomy of local government units to provide basic services to their
constituency by enhancing their capacity to generate local revenues from real property;
(d)  Separate  the  function  of valuation  of real  properties  from  the  functions  of tax  policy
formulation and administration of the taxes due thereon;
(e) Support the development and professionalization of the valuation practice in the country
pursuant to Republic Act No.  9646, otherwise known as the "Real Estate Service Act of the
Philippines";
(f)   Provide   a   comprehensive   and   up-to-date   electronic   database   of  all   real   property
transactions;
(g)  Support the  development  of an  information  database  on  valuation  through  continuing
research  and  monitoring  of new  developments  in  the  discipline  to  upgrade  the  country's
valuation system and be at par with global standards; and
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(h) Ensure transparency in real property transactions to protect public interest,  and develop
confidence in the valuation system.
SEC.  3 . Def inition Of Terms. - Ais used .in tit:Is Aict..
(a)4prc#.ssr also known as valuer, refers to a person who conducts valuation;  specifically,
one who possesses the necessary qualifications, license, ability, and experience to execute or
direct the valuation of real property;
(b)             4s'sessec7  7rcr/#e,. also  known  as  taxable  value,  refers to the  market  value  of the
property multiplied by the corresponding assessment level;
(c)4s'ses,s'mc77/ refers to the act or process of determining the value of a property, or proportion
thereof subject to taxation,  including the discovery,  listing,  classification,  and  appraisal  of
properties;
(d)             4s's'es's7"e73f I,eve/ refers to the percentage applied to the market value to determine
the taxable value of the property based on property classifications as prescribed in Republic
Act No.  7160, otherwise known as the "Local Government Code of 1991", as amended;
(eMssessor refers to the official  or employee in the local government unit (LGU) who is a
duly licensed appraiser, and performs appraisal and assessment of real properties,  including
plant,  machinery,  and  equipment,  for  taxation  and  other  purposes.   This  definition  also
includes assistant assessor;
(f)B#J./dJ.77g  refers  to  a  man-made  structure  permanently  attached  to  land  for  residential,
commercial, industrial, recreational, or other purposes;
(g)             J"provcJ#e#Z refers to a valuable addition made to a property or an amelioration in
its condition, amounting to more than a mere repair or replacement of palls, involving capital
expenditures and labor intended to enhance its value, beauty, or utility, or to adapt it for new
or further purposes;
(I;)             Internationally  accepted  valuation  standards  shal,Il  rofer  to  genera,Ily  accepted
standards for the valuation for all types of assets including real estate plant and equipment,
intangible  assets  and  businesses  which  shall  include,  but  not  limited  to,  the  international
valuation standards;
(i) J#/er/7crzz`o7?cr/  vcr/#cr/7.o#  I/cr77c7tzrc7s'   shall   refer  to   standards   for   undertaking   valuation
assessments using generally recognized  concepts and principles that  promote transparency
and consistency evaluation practice as determined by the International Valuation  Standards
Council;
¢) £cz77c7 refers to one of the major factors of production which is supplied by nature without
the aid of man.  Land may include not only the earth's surface, both land and water, but also
anything that is attached to the earth's surface including all natural resources in their original
state, such as mineral deposits, wildlife, and timber;
(k)              A4crchJ.J7ery refers to machines,  equipment,  mechanical  contrivances,  instruments,
appliances,  or apparatus which may or may not be attached,  permanently 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;
(I)A4c}7.4eJ vcr/zfe refers to the estimated amount for which a property  shall  exchange on the
date of valuation between a willing buyer and a willing seller in an arm's length transaction
which is a transaction between independent, unrelated parties involving no irregularity, after
proper marketing, wherein the parties had each acted knowledgeably, prudently, and without
compulsion;
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(in)             Pr;.vczze  czzzprc#.scr/  seczoJ'  refers  to  licensed  nongovernmental  real  estate  service
practitioners;
(n)              j3ec7/ cs/crze refers to the land and all those items which are attached to the land.  It
is the physical tangible entity, together with all the additions or improvements on, above, or
below the ground;
(o)              J3ecr/ Proz7eJ`fy refers to all the rights, interests and benefits related to the ownership
of real estate. It is a legal concept distinct from real estate, which is a physical asset;
(p)              SYcfrec7w/e o/A4cr7'4ez ycz/#eLs, hereinafter referred to as SMV, refers to a table of base
unit market values for all kinds of real property,  except machinery within an LGU prepared
by assessors pursuant to existing laws, rules and regulations;
(q)             fpecz.cr/ pzfrpose pJ'operty  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 since its special design
and   function   renders   conversion   to   other   types   of  development   or   application   not
economically feasible; and
(r) Vcr/#cz/J.o#,  also known as appraisal, refers to the systematic,  analytic and logical analysis
of the recording of property facts, circumstances, investments and other relevant data resulting
in a supportable estimate or professional opinion of the value of the property as of a specific
date and for a specific purpose.
ARTICLE 11
TIH BUREAU OF LOCAL GOVERNMENT OF FINANCE (BLGF)
Chapter I
BLGF Central Operations
SEC. 4. Powers and Functions of the Bureau of Local Government Finance (BLGF).-               The
BLGF of the Department of Finance (DOF), shall lead and manage the implementation of the provisions
of this Act. In addition to the powers vested upon it by Executive Order No. 292, otherwise known as the
"Administrative Code of 1987", it shall exercise the following additional powers and functions:
(a) Develop, adopt,  and maintain valuation standards consistent with internationally accepted
valuation standards, regulations, and specifications for real property appraisal used for taxation
and other purposes, and ensure compliance therewith by LGs and other concerned parties;
(b) In coordination with the Bureau of Internal Revenue, review and ensure that the Schedule
of Market  Values  (SMVs)  as  prepared by the  provincial  assessors together with  municipal
assessors, and city assessors, including the lone municipal assessor in the Metropolitan Manila
Area  is  compliant  with  real  property  valuation  policies  and  standards,  and  recommend  its
approval to the Secretary of Finance for local and national taxation, and for other purposes;
(c) Provide technical assistance on real property appraisal matters to government agencies and
instrumentalities,  and coordinate or conduct the valuation of special purpose property,  when
requested;
(d) Provide leadership and policy direction to LGUs on real property valuation for taxation and
other  purposes,  including  the  development  and  maintenance  of  internationally  accepted
valuation  standards,  the regulation of valuation activities  and other related  matters,  and the
promotion of valuation training and seminars;
(e) Maintain a roster of licensed local government appraisers and assessors in consultation and
coordination with the Professional Regulation Commission;
(f 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 a continuing study and research on valuation, and maintain information on current
global and country trends and developments in real property valuation;
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(h) Formulate and provide for uniform procedure on the different transactions in the assessor's
office, including the transfer, annotation, and issuance of tax declarations;
(i) Determine, fix, and collect a reasonable amount to be charged as administration fees, fines,
and penalties relative to the implementation of this Act; and
j)  Perform  such  other  functions  as  are  necessary,  proper,  and  incidental  to  implement  the
provisions of this Act.
SEC.  5.  Establishment  Of the  lleal  Property  Valuation  Service.  -To  a;ctireNe the pdic:lee  atnd
objectives declared in this Act, the Real Property Valuation Service, hereinafter referred to as the RPVS
is hereby established within the BLGF and shall have counterpart personnel in the BLGF Regional Offices.
SEC. 6. Supervisory Role Of the BLGF Executive Director over the RPVS. -TheFILGF ExecMiIve
Director shall be responsible for the efficient and effective day-to-day performance of the responsibilities
set forth in this Act, and for the overall internal management and governance of the RPVS.
SEC.  7. Creation Of Central Consultative Committee .
(a) A Central Consultative Committee shall be created and shall  serve as the consultative forum
on matters pertaining to the setting and adoption of internationally accepted valuation standards and other
related concerns on real property valuation;
(b) It shall be chaired by the BLGF Executive Director and shall be 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; and
(6) Private appraisal sector:
Proi;7.czecJ,  That  the  representative  from the  private  appraisal  sector  shall  have  an  experience  as
licensed  real  estate  appraiser  for  at  least  five  (5)  years,  by the  accredited  and  integrated  professional
organization (AIPO) for Philippine real estate practitioners, provided, however, in the absence of AIPO,
the same shall be duly certified by Professional Regulatory Board Of Real Estate Service (PRBRES).
(c)  The  representatives  of the  BR  DENR,  and  BSP  must  be  performing  valuation-  related
functions.  The aforementioned national organization of government assessors,  and the private appraisal
sector   shall   be   represented   by   their   respective   heads   of  organizations   or   their   duly   qualified
representatives.
d)  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;
and
(e) The Committee shall meet either physical, virtual, or hybrid 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.  The Chairperson may invite resource persons on issues concerning
real property valuation.
Chapter 2
BLGF Regional Operations
6


SEC.  8.  jzo/c  o/ /fee B£GF Zzcg7.o77cr/ OLgrces.  -  The  BLGF  Regional  Offices  shall,  through the
Regional Director, be responsible for all matters relating to valuation and the supervision of the SMVs in
the region.  They shall:
(a) Implement policies, plans, programs, rules and regulations on real property valuation of LGUs
in the region;
(b) Review, in coordination with the BIR, and endorse to the RPVS, the proposed SMVs prepared
by the assessors of the LGUs in the region;
(c) Provide for economical, efficient and effective valuation services in the region;
(d) Coordinate and consult with other government departments,  bureaus and agencies within the
region dealing with real property valuation;
(e)  Adopt  and  maintain  a  comprehensive  and  up-to-date electronic  database  of all  regional  real
property-related  transactions,  and  have  custody  of all  transaction  records  submitted  by  local
government assessors; and
(f) Perform other functions as may be assigned by the BLGF Executive Director.
SEC. 9. The Regional Consultative Committee-
(a) There shall be a Regional Consultative Committee that shall be chaired by the BLGF Regional
Director and shall be composed of the:
( 1 ) BIR Regional Director or the duly authorized representative;
(2) DENR Regional Director or the duly authorized representative:
(3)   Head   of  Regional   organization   of  government   assessors   or   the   duly   authorized
representative;
(4) Head of Regional organization of national government appraisers or the duly authorized
representative;
(5) Head of the private appraisal sector within the region or the duly authorized representative;
and
(6) Head of the bankers association within the region or its duly authorized representative.
(b) The members of the Regional Consultative Committee must be performing valuation-related
functions in their respective agencies or sector.  The representative from the private appraisal sector shall
have an experience as licensed real estate appraiser for at least five (5) years, by the AIPO for Philippine
real estate practitioners, provided, however, in the absence of AIPO,   the same shall be duly certified by
PRBRES;
(c)  The  Committee  shall  meet  either  physical,  virtual,  or hybrid  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 function. The BLGF Regional Director may invite
resource persons on issues concerning real property valuation; and
(d)  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.
SEC.   10.  Function  Of  the   Regional  Consultative   Committee.   ~  The  F`eg:+oual  Cousulrfuirve
Committee shall serve as a 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;   training of local  government  assessors  in the
region;  appraisal  and  assessment  concerns  in general;  and  other matters  as may  be  determined  by  the
Committee: Prow.c7ec7,  That any reports and data thereof,  as a result of the forum,  shall be submitted in
accordance with the guidelines as may be prescribed by the Central Consultative Committee,
ARTICLE IH
VALUATION OF REAL PROPERTIES
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Chapter 1
Valuation Standards and Market Values
SEC.  / /. Deve/op777e77Z o/ Vcr/#crf7.o77 S/cr72charck.  -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 LGs and other concerned parties in the appraisal
or valuation of lands, buildings, machinery and other real properties for taxation and other purposes. The
valuation standards shall conform with the internationally accepted valuation standards and principles.
SEC.  /2.  ycJ/€jcrzJ.o77 o/j2ecr/ P/aperty. -For valuation purposes, all real properties, whether taxable
or  exempt,  shall  be  valued  or  appraised  based  on  prevailing  market  values  in  the  locality  where  the
property is situated,  in conformity with the valuation standards adopted pursuant to this Act.             The
Secretary of Finance shall promulgate the rules and regulations for the valuation of real property pursuant
to the  provisions  of this  Act.  For real property  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.
SEC.  13 . Preparation Of the Schedule Of Market Values. -The prow.mc;ral Erssesso[s, together with
the municipal assessors, and the city assessors, including the lone municipal assessor in the Metropolitan
Manila  Area,  shall  prepare  the  SMVs  for  the  different  classes  of real  property  situated  within  their
respective LGs, pursuant to the valuation standards, rules, regulations, and other specifications set by the
DOF.  The preparation of the SMVs shall be completed within six (6) months following the notice from
the BLGF to all local assessors to submit their revised SMVs.
Upon its  completion, the local  assessor  shall  submit the proposed  SMV to the BLGF Regional
Office. Within ninety (90) days from receipt thereof, the BLGF Regional Office, in coordination with the
BIR Regional Office,  shall review and endorse the proposed SMV to the BLGF Executive Director and
the Commissioner of Internal Revenue:  Provided,  That,  in the case of cities and the  lone municipality
within Metropolitan Manila Area, the proposed SMV shall be submitted to, and reviewed by the BLGF
Central Office, in coordination with the concerned BIR Regional Office: Provided further, That the SMV
complies will all the requirements set by the Secretary of Finance,  including the conduct of at least one
(1) public consultation on the proposed SMVs.
SEC.  14 . Approval Of the Schedule Of Market Values. -The Seorcta;ry Of Find,nc,e shall approve the
SMV in accordance with internationally accepted valuation standards, within thirty (30) days from receipt
of the joint  endorsement of the BLGF  Executive Director and the  Commissioner of Internal  Revenue;
otherwise,  said  schedule  shall  be  deemed  approved.  In  case  of sudden  changes  in  the  market  values,
including  but  not  limited  to  ancestral  domain,  public  land,  agrarian  reform  beneficiaries,  and  other
vulnerable  sectors, the  assessor is  mandated to recommend to the scz#gg3f7#.cz77 tax rates and  assessment
levels that will maintain or minimally affect the real property tax due for the aforementioned property.
The power of the  Secretary to approve the SMV shall  not be construed to abridge the power of
LGUs to adjust assessment levels and tax rates, in accordance with Section 15 of this Act, and to provide
relief to real property owners as deemed necessary.
The  approved  SMV  shall  take  effect  fifteen  (15)  days  after  its  publication  by  the  DOF  in  the
Official  Gazette or in at  least two (2)  newspapers of general  circulation,  and posting  in the respective
provincial capitol, city hall and municipal hall, and in two (2) other conspicuous public places within LGU
covered by the approved SMVs.
8


The DOF and the concerned LGs shall post the approved SMVs in their official websites.
SEC.  /5.  STezf7.77g.4sb`c5s7"e7?J I,e+!e/s cz#c7 rc}¥ jzcr/es'.  -The approved  SMV shall be transmitted to
the concerned local chief executive, through the respective provincial,  city,  and municipal assessor.  The
concerned assessor, in coordination with the local treasurer, shall estimate the revenue and tax impact of
the new SMV on taxpayers based on existing assessment levels and tax rates, and recommend amendments
thereon based on three (3) PROPOSED OPTIONS. The assessor shall thereafter prepare and submit the
revenue and tax impact report to the local chief executive for consideration.
The  local  chief executive  shall transmit the  approved  SMV,  together with the  revenue  and  tax
impact report, within fifteen ( 15) days from receipt of the same to the sc7#gg'i#7?J.cJ# for the enactment of an
ordinance setting the appropriate assessment levels and tax rates.  During the LsflJzggzf#7.CZJ?'s deliberations
prior to the enactment of the tax ordinance, it may call upon the assessor to provide technical assistance
and  calculate the  revenue  and tax  impact  of additional  options  in order to  arrive  at  a desired  level  of
revenue and tax goals that the scr#ggr/#z.cz# will adopt.  The sanggunian shall evaluate and enact the most
appropriate   assessment   levels   pursuant   to   Section   218   of  the   LG   and   tax   rates   based   on   the
recommendations of the assessor.  The concerned scr7Jgg#7„.cz7? shall enact the tax ordinance within sixty
(60) days from receipt thereof, upon conduct of public hearings and proper consultations; otherwise, the
existing ordinance on assessment levels and tax rates shall remain in force and effect.
Upon the enactment by the scz#gg#7zJ.cz# of an ordinance for the assessment levels and tax rates, the
local chief executive shall act within ten (10) days, in the case of cities, including the municipality in the
Metropolitan Manila Area,  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.
SEC.  /6. Pcfb/I.co/7.o# a/4s5.e6's'rme72Z fevc/,s' cz73c7 rtzic Rates. -Within ten ( 10) days from the approval
of the ordinance for the assessment  levels and tax rates, the same shall  be published by the concerned
LGU in a newspaper of local circulation for three (3) consecutive days: Prot#.c7cc7,  That in provinces and
cities,   including  the   lone   municipality  within  the  Metropolitan  Manila  Area,   where  there  are  no
newspapers of local circulation, the same shall be posted in the provincial capitol, including all concerned
city halls, or municipal halls, and in two (2) other conspicuous public places therein, for at least thirty (30)
days: Prov7.c7cc7, further, that when available, the concerned LGU shall post the approved ordinance for the
assessment levels and tax rates in its official website and in other online portals maintained by the LGU.
SEC.  /7.  I/se o/ScfoecJ#/c o/A4crr4e/ ycz/#e,s.  -The approved SMV shall be used as bases for the
determination of real property-related taxes of national and local governments, as follows:
(a)  In the  conduct of general  revision  of assessment  and  property  classification to  ensure the
proper cleansing and updating of records, and notification of property owners.
(b) In computing any internal revenue tax, the BIR Commissioner shall use the SMV, or the actual
gross selling price in consideration,  as stated in real property transaction documents, whichever
is higher.
(c) In determining the appropriate price offer, through negotiated sale of the right of way site or
location for a national government infrastructure project, the implementing agency may use the
approved SMV by the Secretary of the Department ofFinance under Section 5 ofR.A. No.10752
otherwise known as "The Right-of-Way Act".
(d) In the guidelines for expropriation proceedings under sec. 6.a.1 ofR.A. No.10752,           upon
the filing of the complaint or at any time thereafter, and after due notice to the defendant,            the
implementing agency  shall  immediately deposit to the court in favor of the owner, the amount
9


equivalent to One hundred percent (100%)  of the value of the land based on the approved SMV
by the Secretary of the Department of Finance. issued not more than three (3) years prior to the
filing of the expropriation complaint subject to subparagraph (c) of this section: P7`ovz.c7cc7,  That
under                  Sec. 6.a.2.i, on the replacement cost at current market value of the improvements
and structures shall be based on the approved SMV: Provz.cJccZ, further, that under Sec. 6.a.3, the
current market value of crops and trees located within the property shall likewise be based on the
approved SMV.
(e) In Sec.  7 of R.A. No.  10752, on the standards for the assessment of the value of the property
subject to negotiated sale, the approved SMV shall be observed.
For other purposes,  such as local transfer tax, tax on sand and gravel,  community tax,  fees and
charges, or as benchmark for real property appraisal of other government agencies, the approved SMV
shall be used upon its effectivity:
Prow.cJecJ, however, that in times of national emergency or state of national calamity,                    the
Secretary of Finance may defer the implementation of the new SMV or suspend the conduct of general
revision.
SEC.  18 . Updating Of the Schedule Of Market Values. - A:Il prow.+rLc:Lad a:ssessors. togerfuer w.rth the
municipal assessors and the city assessors, including the lone municipal assessor within the Metropolitan
Manila Area,  shall update their respective  SMVs within two (2) years from the effectivity of this Act.
Thereafter,  they  shall  update  the  SMVs  and  conduct  general  revision  of property  assessments  and
classifications  once  every  three  (3)  years  from  the  date  of last  revision.  The  BLGF  shall  prepare the
schedule for the updating of the SMVs in all provinces and cities, including the lone municipality within
the Metropolitan Manila Area.
In case of any significant change in market value where the property is located after the SMV has
been approved and prior to the next revision, such as in times of calamities, disasters, man-made or natural
and other adverse circumstances,  or where correction of errors and inequalities in the  SMV is deemed
necessary, or upon the order of the Secretary of Finance, the provincial and city assessors shall recommend
revisions  to  the  existing  SMVs  to  the  BLGF  Regional  Office,  through  the  BLGF  Regional  Director
exercising jurisdiction over the LGU concerned: Prot;jcJcc7, That, the city assessors and the lone municipal
assessor within the Metropolitan Manila Area,  shall  recommend revisions to the existing  SMVs to the
BLGF Central Office.
Such revision or revisions shall be subject to review by the concerned BLGF Regional Office and
the BIR Regional  Office which  shall  complete their review  and  submit their recommendations to the
BLGF Executive Director, in accordance with Section 13 and 14 of this Act.
SEC.  /9. Co#c7#cf a/ Cczpczc7.ty B#7./d7.ng J77/ervc#f7.o7?s.  -The BLGF shall, in coordination with the
Philippine Tax Academy of the DOF, develop and conduct the necessary trainings for all local assessors,
local officials and staff, and other concerned BR personnel on the preparation of the SMVs in accordance
with internationally accepted valuation standards,  concepts,  principles and practices,  conduct of impact
studies; preparation of compliance reports, and other subject areas.
Chapter 2
Development and Maintenance of Real Property. Market Database
SEC.  20.  Development  Of  Real  Property  Information  System.-The TILGE  shall  develop  a;nd
maintain an up-to-date electronic database of the sale, exchange, lease, mortgage, donation, transfer and
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all  other real  property transactions  and  declarations  in the  country and  on the  cost  of construction  or
renovation of buildings and other structure, and on prices of machinery.
For this purpose, the BLGF shall require the mandatory submission of necessary documents from
the concerned officials or employees of national government offlces or instrumentalities, LGUs, and the
private  sector:  Provided,  That  in the  case  of government  agencies  and  instrumentalities,                     the
mandatory submission of documents and information shall be subject to the prohibition of disclosure of
certain information under the Data Privacy  Act  and other existing laws.  The updated database shall be
made available to the LGUs, national government agencies, and the private sector. Provz.c7ec7, /#rf¢er, That
the Commissioner of Internal Revenue or a duly authorized representative shall be allowed access to the
database without need of prior approval: Prov7.c7ecJ, /j72cz//ry,  That                                  non-submission of the
required  documents  to  the  BLGF  will  subject  the  concerned  official  or  employee  to  administrative
penalties pursuant to the provisions of Section 28 of this Act.
To  further  ensure  the  efficiency  of real  property  tax  administration,  all  provinces,  cities  and
municipalities shall automate their operations, adopt tax mapping technology, maintain software-enabled
valuation systems, undertake regular data cleansing, and computerize records management. The National
Government, through the Department of Information and Communications Technology, shall provide the
appropriate equipment and connectivity,  information and communications technology platform,  and the
appropriate training and capability building programs to third class up to  sixth class municipalities  and
provinces to ensure compliance with this section. The BLGF shall establish mechanisms for the electronic
submission of the required documents in accordance with the provisions of Chapter 2,  Article 11 of this
Act.
SEC.  21. Duty Of Register Of Deeds to Supply Assessors with Real Property Transactions Data.-
The Register of Deeds shall prepare and submit to the provincial municipal assessor in the Metropolitan
Manila Area,  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 descriptions of the real properties entered herein,
their present owners,  and the dates of their most recent transfer or alienation accompanied by copies of
corresponding deeds of sale, donation, or partition, or other forms of alienation.
SEC. 22 . Duty Of Official Issming Building Permits or Certificates Of Registration Of Machinery to
rrcrus7#7./ Capy a/Pcrmz./ Jo /fee 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.  23 . Duty Of Geodetic Engineers to Furnish Copy Of Plans to the Assessor . -I:1 sheAI 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
(ELURB), as the case may be.
SEC.  24.  Duty  Of  Registrar  Of  Deeds  cnd  Notaries  Public  to  Assist  the  Provincial,  City,  or
A4"77/.c7.pcr/Assessor.  -It shall be the duty of the Registrar of Deeds and notaries public to furnish, free of
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charge,  the  provincial,  city  or  municipal  assessor with  copies  of all  contracts  selling,  transferring,  or
otherwise  conveying,  leasing,  or mortgaging  real  property  received  by,  or acknowledged  before them
within such periods as the BLGF shall prescribe.
SEC.    25.    Transmission    Of   Real    Property    Transactions   Data   to   the    BI,GF.    -   Upon
operationalization of the real property transactions database provided in Section 20 of this Act, it shall be
the  duty of the  registers of deeds,  notaries  public,  officials  issuing building  permits,  and the geodetic
engineers conducting surveys within a locality to electronically transmit to the concerned BLGF Regional
Office relevant real property transactions data, in accordance with rules and regulations to be promulgated
by the Secretary of Finance.
Chapter 3
Appointment and Qualifications of Assessors
SEC.  26. 4po7.#Z"e7.J o/4,§b'csso7`b`.  - The local chief executive shall appoint the provincial,  city
and municipal assessors and assistant assessors, as the case may be, in accordance with Civil Service Law,
Real Estate Service Act, 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  (3) ranking  eligible  candidates
within the region;
(b)    In the  case  of city  and  assistant  city  assessors,  and  the  municipal  and  assistant  municipal
assessors in the Metropolitan Manila Area,  the appointee  shall be chosen from the list of at
least three (3) ranking eligible candidates within the region;
(c)  In the case of municipal  and assistant municipal assessors, the appointee shall  be within the
province; and
(d) The appointment of an assistant assessor shall be  optional for provincial,  city and  municipal
governments.
The assessors shall be under the technical supervision of the BLGF, primarily through a system of
compliance reporting and of capacity-building through education and training programs.
SEC.  2 7.  0%cr/z./jccrf7.o7? a/£oca/ Gover7?#2e72Z ASL5'e5sors. -No person shall be appointed assessor or
assistant  assessor  unless  a  citizen  of the  Philippines,  a  resident  of the  region  for  a  provincial  or  city
assessor/assistant assessor,  and of the province for a municipal  assessor assistant assessor,  a registered
and licensed real estate appraiser, of good moral character, and must not have been convicted of any crime
involving moral turpitude: Provz.c7ecJ, the appointee is a holder of a college degree preferably in real estate
management or service, civil or mechanical engineering, commerce, or any other related course: Provjc7ec7,
/ztrJfoer,  That  the  assessor  and  assistant  assessor  must  have  experience  in  real  property  valuation  or
assessment work in any suitable field, either in private or public practice, for at least five (5) years in the
case of provinces and cities, and three (3) years in the case of municipalities. Once appointed, all assessors
and local government appraisers must comply with the requirements of the Professional Regulatory Board
Real Estate Service for the regular updating of their licenses.
ARTICLE IV
PENAL PROVISIONS
SEC.  28 . Failure to Comply with the Required Submission Of Documents.- AL gore;mme;ut c>ffic:ra]
or  employee  who  fails  without justifiable  reason  to  provide  or  furnish  data  or  information  required
pursuant to Sections 20, 21, 22, 23, 24 AND 25 of this Act, shall be punished by a fine equivalent to one
(1) month to six (6) months basic salary of the official or employee, or suspension from the service for a
period not exceeding one (1) year, or both, at the discretion of the competent authority.
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A person who fails without justifiable reason to provide or furnish data or information required
pursuant to Sections 20, 23, 24 and 25 of this Act, shall be punished by a fine equivalent to sixty thousand
pesos  (Php  60,000)  up to three  hundred  sixty thousand  pesos  (Php  360,000),  or  suspension  from the
practice of profession for up to one (1) year, or both, at the discretion of the competent authority.
SEC.  29 . Failure to Comply with the Valuation Standards. -  An tlssessor who, For urrfustifla,ble
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 of real property,
shall be punished by a fine equivalent to one (1) month to  six (6) months basic salary of the official or
employee, or suspension from the service for a period not exceeding one (1 ) year, or both, at the discretion
of the competent authority.
SEC.  30. Failure to Prepare  Schedule Of Market Values. -An arss,essor who, without fustifiab:bite
cause or reason,  intentionally or deliberately refuses or fails to prepare the SMVs within the period  set
forth in this Act shall be punishable by a fine equivalent to one (1) month to six (6) months basic salary
of the official or employee, or suspension from the service for not more than one (1) year, or both,         at
the  discretion  of the  competent  authority.  This  shall  also  be  a ground  for administrative  and  criminal
liability in accordance with the provisions of Republic Act No 9646, otherwise known as the              "Real
Estate Service Act of the Philippines"
SEC.  31. Goverrment Agents Delaying the Review,  Approval and Implementation Of SMV,  and
Co77dzrc/ a/Ge#crcr/ jlev7.s7.o7?s. - Any government official who delays, without justifiable cause or reason,
the review,  approval  and  implementation of the  SMVs,  the conduct of general  revisions,  or causes the
improper use thereof, shall be punished by a fine equivalent to one (1) month to six (6) months basic salary
of the official  or employee,  or suspension from the  service for a period not exceeding one (1) year,  or
both, at the discretion of the competent authority.
SZC.  32.  y7.o/c}Z7.o/2s' o/Offoer Prov7.$7.o#s.  -Any person, whether natural or juridical, who violates
any provision of this Act other than those punishable under  Sections 28,  29,  and 30 hereof shall,  when
warranted, be dealt with under applicable existing laws.
SEC.   33.  Tacpavers'  Remedies  in  Case  Of  Erroneous  Assessments  Of Real  Properties.  -The
provisions of sections 226 on Local Board of Assessment Appeals and 229 on Action by the Local Board
of Assessment  Appeals  of Republic  Act  No.  7160,  as  amended,  shall  apply  in  all  cases  of appeal  as
remedies for the taxpayers in the assessment of their properties.
All concerned local governments shall cause the constitution of a fully functioning Local Board of
Assessment   Appeals   in   their  respective  jurisdictions,   in   coordination  with   the   Land  Registration
Authority.
ARTICLE V
TRANSITORY PROVISIONS
S'ZiTC.  34.  rrcr#5'7.Zory G#z.c7e/z`#e5'.  -LGUs which are in the process of updating their  SMVs shall,
upon the effectivity of this Act, continue with such revisions in accordance with Sections 15,16,17, and
18 of this Act: Prow`c7ec7,  That proper notification and coordination with the BLGF shall be undertaken.
In case the  SMV is not yet available or updated, the BIR Commissioner shall adopt the existing
SMVs, 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.
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SEC.  3J.  S'crv7.7?g  C/cr#,se.  -  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  city  assessors,   and  municipal   assessors,   including  the  municipal  assessor  in  the
Metropolitan  Manila  Area,  that  have  been  approved by  their  respective scr7?gg##7.cr#,s'  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 updated SMVs as approved in accordance with Section
15 of this Act, which shall be within two (2) years upon the effectivity of this Act.
To cushion the impact in case of a sudden increase in real property values, LGUs are enjoined to
utilize the provisions on setting assessment levels and tax rates under Section  15 of this Act.
ARTICLE VI
FUNDING REQUIRENINT S
SEC.  36. Budgetary  Requirements for  the  Updating Of Schedule  Of Market Values.-Tiaich toca,i
s'cr77gg"7?J.cr77 shall appropriate the necessary funds from locally generated revenues fiscal year to constitute
the Real Property Tax Administration Fund, the National Internal Revenue Tax Allotment or such other
sources every fiscal year to constitute the Real Property Tax Administrative Fund (RPTAF), which shall
be established and used for the proper implementation of the updating of the SMVs and general revision
of real property assessments, and the administration of real property taxes in all LGUs.
The BLGF shall annually furnish the Department of Budget and Management (DBM) with a list
of local government units with SMVs that are due for updating.  The DBM, in its review of the ensuing
year's  budget  of provinces,  highly  urbanized  cities,  independent  component  cities  and  municipalities
within the Metropolitan Manila Area, shall ensure that sufficient funds are so appropriated for the RPTAF:
Prov7.c7ec7, That failure to provide the appropriations required shall render their annual budgets inoperative.
ARTICLE VII
MISCELLANEOUS PROVISIONS
SYEC.   37.  D7.Ls'j77ce7?Z7.ve  SZzZ?„/crf7.o77s.   -  Notwithstanding  the  provisions  of  existing  laws  to  the
contrary, the failure to conduct a general revision of assessment and property classification, and use of the
approved  SMV  shall  render  an  LGU  ineligible  for  any  conditional  or  performance-based  grant  or  to
contract any form of credit financing.
LS'EC.  38.  4xp7.apJ'jcJZ/.o7?a.  -  The  amount  necessary  for  the  implementation  of this  Act  shall  be
included in the annual General Appropriations Act.
SEC.  39.  Suppletory Application  Of Existing Laws.  -The prow.istious o£ BLapho1±c  Alct No. 7160,
otherwise known as the "Local Government Code of 1991 " as amended, and other laws consistent with
this Act shall have suppletory effect.
SEC.  40 . Implementing Rmles and Regulations (IRR). -`N.Tth:+rL six (6) moITths a,fte[ tine effectiv.rty
of this  Act,  the  DOF  shall,  in  consultation  with  concerned  parties,  issue  the  IRR  for  the  effective
implementation of this Act.
SYEC.   4/.   S'e/?crrc¥bj/7.ty   C/cr#se.   -   If  any   section   or  provision   of  this   Act   shall   be   declared
unconstitutional  or invalid,  other sections or provisions not affected thereby  shall continue to be in full
force and effect.
A?EC.  J2. f{ez7ecr/J.#g C/cr#se. -The following provisions are hereby repealed:
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(a) Sections 212, AND 214 of Republic Act No. 7160, otherwise known as the "Local Government
Code of 1991", as amended; and
(b) Section 4(h) of presidential Decree No.  538.
The following provisions are hereby amended accordingly:
(1) Section 33, Chapter IV, Title I, Book IV, of Executive Order No. 292, otherwise known
as the "Administrative Code of 1987"
(2) Sections 19,135(a),138, 201, 218, 220, 472(a), 472 (b)(8), and 473(a) of Republic Act
No.  7160;
(3) Sections 5, 6 and 7 of Republic Act No.10752, otherwise known as The Right-of-Way
Act"
(4) Section 9 of presidential Decree No. 921 ; and
(5) Sections 6(e), 27 (d)(5), and 88(b) of Republic Act No.  8424, otherwise known as the
National Internal Revenue Code of 1997, as amended.
AIl 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.  J2. EJ#cc/z.i#.fy. I This Act shall take effect fifteen ( 15) days after its publication in the Official
Gazette or in a newspaper of general circulation.
Approved.
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