Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session

House Bill No,__ 3368

Introduced by Representative Sharon S. Garin

EXPLANATORY NOTE

This bill is the third part of the Comprehensive Tax Reform Program
which has already been approved on third reading last 17" Congress. It aims
to introduce vital reforms to promote the development of a just, equitable, and
efficient real property valuation system.

Currently, there are many basis of property valuation from local to
national levels of government. This bill will broaden and simplify the tax based
used for property and property-related taxes, hence, increasing government
revenues without increasing the existing tax rates or devising new tax
impositions.

This representation believes that by making the revisions on property
valuation more frequent, efficient, transparent, reliable and attuned to market
developments, there will be efficient revenue generation and resource
mobilization of local governments to fund their projects, programs and
platform within their locality. To this, private investors and the public's trust will
build up on the government valuation

Hence, this bill aims to improve real property valuation for the
government by adopting a market-based Schedule Market Value to be used
as basis of local and national real property taxation. SMV refers to a table of
base unit values for all kinds of real properties within a local government unit
(LGU) prepared by assessors.

In the present system, valuation standards of property are being
determined by the LGUs to which many have not made any revisions to the
standard. This resulted in a stagnant outdated, and highly-politicized real
property valuation that is inconsistent with the realities of the market
economy.


With this measure, the highly technical function of real property
valuation is separated from the political function of taxation. Thus, local
officials are insulated from the pressures and political backlash borne out of
initiatives to correct and update their respective SMVs

In view of the foregoing, the passage of this bill is earnestly sought for.



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session

3368

House Bill No.

Introduced by Representative Sharon S. Garin

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.”

ARTICLE |
DELCARATION 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

(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;

) 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 the 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,”

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

(a) 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 to be at par with global standards; and

(h) Ensure transparency in real property transactions to protect
public interest, and develop confidence in the valuation system.

SEC. 3. Definition of Terms. — As used in this Act:

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

(b) Assessed Value, also known as taxable value, refers to the market
value of the property multiplied by the corresponding assessment
level;

(0) Assessment 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) Assessment Level 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, as amended;

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

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

(g) Improvement refers to a valuable addition made to a property or an
amelioration in its condition, amounting to more than a mere repair or
replacement parts, involving capital expenditures and labor intended


to enhance its value, beauty or utility or to adopt it for new or further
purposes;

(h) International Valuation Standards refers to standards that provide
property valuers with a framework composed of recognized principles
and concepts as well as internationally accepted definitions, best
practices, and reporting system;

(i) Land 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,

() Machinery refers to machines, equipment, mechanical contrivances,
instruments, appliances or apparatus which may 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 vary
nature and purpose are designed for, or necessary to its
manufacturing, mining, logging, commercial, industrial or agricultural
purposes;

(k) Market Value 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;

()) Private Appraisal Sector refers to licensed non-governmental real
estate service practitioner who have been active in the practice of
real estate appraisal for at least five (5) years;

(m) Real Estate 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;

(n) Real Property 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;

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


(p)

(a)

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 going concern. Sue to the special design
and the function, conversion of special purpose property to other
types of development or application is generally not economically
feasible; and

Valuation, 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 ofa
specific date and for a specific purpose

ARTICLE Il

THE BUREAU OF LOCAL GOVERNMENT FINANCE (BLGF)

Chapter |
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. It shall have the
following powers and functions:

(a)

(b)

(©)

()

Develop, adopt, and maintain valuation standards consistent
with generally accepted international valuation standards,
regulations and specifications for real property appraisal used
for taxation and other purposes, and ensure compliance
therewith by Local Government Units and other concerned
parties;

In coordination with the Bureau of Internal Revenue (BIR),
review and ensure that the Schedule of Market Value (SMVs)
as prepared by the provincial assessors together with
municipal assessors, and city assessors, including the
municipal assessors 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;

Provide technical assistance on real property appraisal matters
to government agencies and instrumentalities, and coordinate
or conduct the valuation of special purpose property, when
required:

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


(2)

(f)

(9)

(h)

0)

0)

Maintain a roster of licensed local government appraisers and
assessors;

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

Conduct continuing study and research on valuation, and
maintain information on current global and country trends and
developments in real property valuation;

Formulate and provide for uniform procedure on the different
transactions in the assessor's office, including the transfer,
annotation, and issuance of tax declarations;

Determine, fix and collect a reasonable amount to be charged
as administration fees, fines and penalties relative to the
implementation of this Act; and

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 policies and objectives declared in this Act, the Real Property
Valuation Service, hereinafter referred to as the RPVS, within the BLGF with
counterpart personnel in the BLGF Regional Offices is hereby established

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

SEC. 7. Creation of a Central Consultative Committee. -

(a)

(b)

A Central Consultative Committee shall be created and shall
serve as the consultative forum on matters pertaining to the
setting, adoption, and maintenance of the valuation standards
and other related concerns on real property valuation

It shall be chaired by the BLGF Executive Director shall be
composed of a representative each from the

4. 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;


()

(a)

)

5. National organization of appraisers in national government
agencies; and

6. Private appraisal sector.

The representatives of the BIR, DENR, and BSP must be
performing valuation-related functions. The _ national
organization of government assessors, and the private
appraisal sector shall be represented by their respective heads
of organizations.

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.

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. The Chairperson may invite resource
persons on issues concerning real property valuation.

Chapter 2
BLGF Regional Operations

SEC. 8. Role of the LBGF Regional Offices. - The BLGF Offices,
through the Regional Director, shall be responsible for all matters relating to
valuation and the supervision of the SMVs in the region. They shall

(a)

(b)

()

(d)

(e)

()

Implement policies, plans, programs, rules and regulations on
real property valuation of local government units in the region:

Review, in coordination with the BIR, and endorse to the
RPVS, the proposed SMVs prepared by the assessors of the
local government units in the region:

Provide for economical, efficient and effective valuation
services in the region;

Coordinate and consul with other government departments,
bureaus and agencies with the region dealing with real property
valuation;

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

Perform other function 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 a
representative from the:
1. BIR — Regional Office;
DENR — Regional Office;

Head of Regional organization of government assessors,

k oN

Head of Regional organization of national government
appraisers;

5, Head of the private appraisal sector with the region; and
6. Head of the bankers association with the region.

(b) The members of the Regional Consultative Committee must be
performing valuation-related functions int heir respective agencies
sector.

(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 function. The BLGF Regional Director may
invite resource persons on issues concerning real property valuation.

SEC. 10. Function of the Regional Consultative Committee. - The
Regional Consultative 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

ARTICLE Ill
VALUATION OF REAL PROPERTIES
Chapter 4

Valuation Standards and Market Values

SEC. 11. 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 local government units 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 generally accepted international valuation
standards and principles.

SEC. 12. Valuation of Real Property. ~ 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 generally
accepted international valuation standards.

SEC. 13. Preparation of Schedule of Market Values. ~ The provincial
assessors together with city and municipal assessors, including the municipal
assessors in the Metropolitan Manila Area, shall prepare the SMV for the
different classes of real property situated within their respective local
government units, pursuant to the valuation standards, rules, regulations and
other specifications set by the DOF. The proposed SMV shall submitted to the
BLGF Regional Office and the BIR Regional Office for their joint review and to
ensure that the SMV complies with other requirements within ninety (90) days
from the receipt of the BLGF and BIR Regional Offices.

SEC. 14. Approval of Schedule of Market Values. - The Secretary of
Finance shall approve the SMV within sixty (60) 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.

The approved SMV shall be published by the DOF in the Official Gazette
or in at least two (2) newspapers of general circulation. The SMV shall take
effect fifteen (15) days after its publication

The DOF shall post the approved SMV in its official website and shall
furnish the concerned local government unit, through BLGF and the BIR, with
copies thereof.

SEC. 15. Setting Assessment Levels and Tax Rates. - The approved
SMV shall transmitted to be concerned assessor who shall confer with the
local chief executive regarding the approved SMV. The assessor, in
coordination with the local treasurer, shall estimate the tax impact of the new
SMV as against the existing assessment levels and tax rates, calculate the
expected level of tax burden that the taxpayers will bear based on the new
SMV and recommend amendments on the assessment levels and/or tax
rates. The assessor shall prepare a minimum of three estimates of the tax
impact based on different scenarios and submit the tax impact report to the
local chief executive and the Sanggunian


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. During the Sanggunian’s deliberations prior
to the enactment of the tax ordinance, it may call upon the assessor to
provide technical assistance and calculate the tax impact of additional options
in order to arrive at a desired level of taxes that the Sanggunian will adopt
The concerned Sanggunian shall enact the tax ordinance upon conduct of
public hearings and proper consultations 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
(10) days, in the case of cities and 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. 16. Publication of Assessment Levels and Tax Rates. - The
approved ordinance for the assessment levels and tax rates shall be
published by the concerned local government unit in a newspaper of local
circulation once a week for two (2) consecutive weeks: Provided, That in
provinces, cities and municipalities where there are no newspapers of local
circulation, the same shall be posted in the provincial capitol, including all
concerned city halls, municipal halls, and in two (2) other conspicuous public
places therein

SEC. 17. Use of Schedule of Market Values. - The approved SMV shall
be used a basis for the determination of real property-related taxes of national
and local governments, as follows.

(a) _ For purposes of real property taxation, the approved SMV shall
in no case be adopted by the local government unit less than
six (6) months prior to the effectivity of the new assessment
rates to ensure the proper cleansing and updating of records.
and notification of property owners in the conduct of general
revision of assessment and property classification

(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) For other purposes, such as local transfer tax, tax on sand and
gravel, community tax, fees and charges, or as benchmark of
real property appraisal of other government agencies, the
approved SMV may be used upon its effectivity.

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 SMV shall render a local
government unit ineligible for any conditional or performance-
based grants or to contract any form of credit financing from the
national government.

SEC. 18. Updating of Schedule of Market Values. — All provincial
assessors together with the city assessors, and the municipal assessors,
including the municipal assessors in the Metropolitan Manila Area, shall
update their respective SMVs within two (2) years form the effectivity of this
Act. Thereafter, they shall update the SMVs and conduct general revision of
property assessments not earlier than three (3) years, but not later than five
(5) years, form the date of last revision. The BLGF shall prepare the schedule
for the updating of the SMVs in all provinces, cities and municipalities within
the Metropolitan Manila Area.

In case of any significant change in market value where the property is
located after the SMVs have been approved and prior to next revision or
where correction of errors and inequalities in any SMV is deemed necessary
or upon the directive of the secretary of finance, the provincial assessors
shall, together with the city assessor's, and the municipal assessors, including
the municipal assessor and the metropolitan Manila area, recommend
revisions to their existing SMV to the BLGF Regional Office, through the
Regional Director off the BLGF having jurisdiction over the local government
unit concerned.

Such revisions shall be subject to review by the concerned B LG F
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 14 hereof.

SEC. 19. Conduct of Capacity Building Interventions. - The BLGF shall,
in coordination with the Philippine Tax Academy of the DOF, develop and
conduct the necessary training for all local assessors, local officials, and staff
and other concerned BIR personnel on the preparation of the SMV in
accordance with generally accepted international valuation standards,
concepts, principles and practices; conduct of SMV 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 and Formation System. - The
BLGF shall develop and maintain an up-to-date electronic database of the
sale, exchange, lease, mortgage, donation and all other property transactions
and declarations in the country and on the coast of construction or renovation
of buildings and other structure, and on prices of machinery

For this purpose, the B LG F shall require the mandatory submission of
necessary documents from the concerned officials or employees of national
government offices or instrumentalities, local government units, and the


private sector. The updated database shall be made available to the local
government units national government agencies and the private sector:
provided, that the commissioner of internal revenue or a duly authorized
Fepresentative shall be allowed access to the database without need of prior
approval: Provided, further, that non submission of the required documents to
the BLGF will be subject to the provisions of Section 28 of Act.

To further achieve these objectives and ensure efficient 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 computerized
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 succeeding
sections of Chapter 2 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 assessors, together with the city assessors, and municipality
assessors, including the municipal assessors 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 description of the real properties entered therein, 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 Issuing Building Permits or Certificates of
Registration of Machinery to Transmit Copy of Permit 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. 23. Duty of Geodetic Engineers to Furnish Copy Off Plans to
Assessor. ~ It shall be the duty of all geodetic engineers, private or private
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 service, duly signed
by a senior geodetic engineer, executed by them every and of the month from
receipt of such approved plans from the Land Management Bureau (LMB)


the Land Registration Authority (LRA), or the house saying and land use
regulatory board HLURB, asked the case may be

SEC. 24. Duty of Registrar of Deeds and Notaries Public to Assist the
Provincial, City, or Municipality Assessor. - It shall be the duty of the
Registrar of Deeds and notaries public to furnish, free of charge, the
provincial, city or municipality 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. 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 deeds, and the
names of the official issuing the building permit and those of the geodetic
engineers within one (1) month after the received of such data, The BLGF's
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. 26. Appointment of Assessors. ~ The local chief executive shall
appoint the provincial, city and municipal assessors and assistant assessors,
as the case may be, in accordance with the 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 (3) ranking eligible candidates within the region;

(b) In the case of city and assistant city assessor's, 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; and

(c) In the case of municipal and assistant municipal assessors, the
appointee shall be chosen from the list of at least three (3) ranking
eligible candidates within the province

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. 27. Qualification of Local Government Assessors. - 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 municipality assessor/assistant assessor
a registered and licensed appraiser, of good moral character, and must not
have been convicted of any crime involving moral turpitude. The appointee
must have experience in real property valuation or assessment work or in any


suitable field, either in private or public practice, 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.

Article IV
PENAL PROVISIONS

SEC. 28. Failure to Comply with the Required Submission of
Documents. - Any government official or and for ye who fails without
justifiable reason to provide or furnish data or information required pursuant to
Sections 20, 21, 22, 23 and 24 of this Act, shall be punished by a 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. 29. 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
deviations or departures from such standards in the valuation of real property
shall be punished by a 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. 30. Failure to Prepare Schedule of Market Values. - And 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 punishable 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 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 administratively 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. Government Agents Delaying the Review, Approval and
Implementation of SMV, and Conduct of General Revisions. - Any
government official who delays, without justifiable cause, the review, approval
and implementation of the SMV, the conduct of general revisions, or cause
the improper use thereof shall be punished by a fine equivalent to the
official's or employee's six (6) month's 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. 32. Violation of Other Provisions. - Any person, whether natural
or juridical druidical, 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. Taxpayers’ Remedies in Case of Erroneous Assessments of
Real Properties. - The provisions of Sections 226 on Local Board ff
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

SEC. 34. Transitory Guidelines. - Local government units which are in
the process of updating their SMV c’s, upon the F activity of this act cama
shall continue with such revisions in accordance with section 16 of this act
provided, that proper notification and coordination with the 8 LG F shall be
undertaken.

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

SEC. 35. 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 city
assessors, and municipal assessors, including the when the municipal
assessors in the Metropolitan Manila Area, 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 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.

Article VI
FUNDING REQUIREMENTS

SEC. 36. Budgetary Requirements for the Updating of Schedule of
Market Values. - Each local sanggunian shall appropriate the necessary
funds from locally generated revenues, the internal revenue allotment 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 updating of the SMVs and
general revision of real property assessments, and the administration of real
property taxes in all local government units.

The BLGF shall annually furnish the Department of Budge! and
Management (DBM) with a list of local government units with SMV that are
due for updating. The DBM, in their review of the and suing year budget of
provinces come up highly urbanized cities, independent component cities and
municipalities within the metropolitan area, shout ensure that sufficient funds
have been budgeted to comply with the requirements of this Act; Provided,



that failure to provide the appropriations here in required shall render their
annual budgets inoperative.

Article Vil
MISCELLANEOUS PROVISIONS
SEC. 37. Appropriations. - The amount necessary for the

implementation of this Act shall be included in the annual General
Appropriations Act.

SEC. 38. Implementing Rules and Regulations (IRR). ~ Within six (6)
months after the effectivity of this Act, the DOF, in consultation with
concerned parties, shall issue the IRR for the effective implementation of this
Act.

SEC. 39. Suppletory Application of Existing Laws. — The provisions of
Republic Act 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. Separability Clause. - If any 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.

SEC. 41. Repealing Clause. —

(a) Sections 188, 199, 201, 202, 2019(a), 212, 214, 219. 220, 472(a)
paragraph 1, 472(b)(8), and 473(a) paragraph 1 of Republic Act
Numbers 7160, otherwise known as the “The Local Government Code
of 1991", are here by repealed;

(b) Section 3(n) of PD 464 of 1974 is hereby repealed:

(c) Section 6 of Republic Act No. 10752, otherwise known as “Right-of-
Way Act’, is hereby repealed;

(d) Section 4 (a) and (b) of Republic Act No. 8974 are here by repealed;

(e) Section 9 of PD 921 on the administration of local financial services in
Metropolitan Manila and creating local Treasury and Assessment
Districts is hereby repealed;

() Sections 19, 1359(a), 138, 198(a), 199(0), 218 and 224(a) of Republic
Act. No. 7160, otherwise known as the “The Local Government Code
of 1991”, are also amended or modified accordingly

(g) Likewise, Sections 6(E), 24(D), 27(D)(5) 88(B) and 102 of Republic
Act No. 8424, otherwise known as the “Tax Reform Act of 1997’, are
likewise amended or modified accordingly


(h) Section 4(h) and Section 9 of PD 538 on the power of Philippine
Veterans Investment Development Corporation Industrial Authority to
collect real property tax; and

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

SEC. 42. Effectivity. — This actual take effect fifteen (15) days after the its
publication in the Official Gazette or in a newspaper of general circulation

Approved.