Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila
EIGHTEENTH CONGRESS
First Regular Session

House BILE No, 9343

INTRODUCED BY REPRESENTATIVE XAVIER JESUS D. ROMUALDO

EXPLANATORY NOTE

Efforts to pass a law instituting reforms in real property valuation and assessment date
back to the 15" Congress, with the House of Representatives approving a valuation and
assessment reform bill on third reading in the 15" and 16" Congresses. In the 17"
Congress, the House of Representative again approved this bill on third reading. However,
the Senate was again unable to take action on it.

There is an urgent need to improve the country's real property valuation and assessment
system and reorganize and strengthen the Bureau of Local Government Finance in order to
effect such improvement. If enacted into law, this measure will support the long-term
revenue efforts of the government through an institutionalize uniform valuation standards
that is consistent with generally accepted international valuation standards, regulations,
and specifications for real property appraisal used for taxation

Hence, the strong support of the Members for the passage of this measure is earnestly

‘sought.
ee ak a Se

XAVIER JESUS D. ROMUALDO


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

EIGHTEENTH CONGRESS
First Regular Session

HOUSE BILLNO. 0343

INTRODUCED BY REPRESENTATIVE XAVIER JESUS D. ROMUALDO

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 |
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 intemational valuation standards, concepts, principles, and
practices. Towards this end, the State shall:

(a) Establish and maintain valuation 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 valuing or appraising real property
for various transactions by all government agencies;

(c) 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;

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

(e) 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”;

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


weovanewne

10
ul
2
3B
14
15
16
v7
18
19
20
21
2
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
a
a2
43

(g) Support the development of an information database 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:

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

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

(c) Assessment refers to the act or process of determining the value of a property, or
proportion thereof subject to tax, 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 the Local Government Code;

(e) 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.

() 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 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;

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

(i) Land refers to one of the major factors of production consisting sometimes of
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, alinatural resources in their original state, such
‘as minerals 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;

() Machinery refers to and embraces machines, equipment, mechanical contrivances,
instruments, appliances or apparatus which may or may not be attached,


wevaneawne

cB
12
13
14
15
16
7
18
19
20
2a
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41

43

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;

(k) 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
knowiedgeably, prudently, and without compulsion;

() Private appraisal sectorrefers to licensed non-governmental real estate service
practitioners who have been active in the practice of real estate appraisal for the last
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.
There may also be potential limitations upon ownership rights to real property.

(0) 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;

(p) 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; and

(q) 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 a property as of a specific date and for a specific purpose;

ARTICLE II
THE BUREAU OF LOCAL GOVERNMENT OF FINANCE (BLGF)

Chapter!
BLGF Central Operations

SEC. 4. Roles of the Bureau of Local Government Finance (BLGF). — The BLGF of

the Department of Finance (DOF), through the Real Property Valuation Service (RPVS) as


1
2
3
4
5
6
7
8
9

10
11
12
3B
14
15
16
17
18
19
20
21
2
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
a
42
43

hereinafter established, shall lead and manage the implementation of the provisions of this Act,
and shall provide leadership in ensuring rationalized valuation of real properties transcending
political boundaries. The BLGF shall have the following powers and functions:

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

(b) lin coordination with the BIR, review and ensure that the SMVs as prepared by the

provincial assessors together with municipal assessors, and city assessors, including
the municipal assessors in 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 and
appraisal of special purpose properties, when requested;

(d) Provide leadership and policy direction 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;

() 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;

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

(h) Formulate and provide for uniformprocedures on the various transactions in the
assessor's office, including but not limited to the transfer, annotation and issuance of
tax declarations;

(i) Determine, fix, and collect reasonable amount 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 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 performance of the responsibilities set forth in this Act,
and for the overall internal management and governance of the RPVS.


wervanawune

uw
12
B
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33

35
36
37
38
39
40
41
42
43

SEC. 7. Creation of the Central Consultative Committee. —

(a) 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.

(b) It shall be chaired by the BLGF Executive Director and shall be composed of a
representative each from the:

1. Bureau of Intemal Revenue (BIR);

. Department of Environment and Natural Resources (DENR);

. Bangko Sentral ng Pilipinas (BSP);

. National organization of government assessors;

National organization of appraisers in national government agencies; and

O2aron

. Private appraisal sector.

(c) The representatives of the BIR, DENR, and the 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.

(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.

(e) 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 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 the:

(a) Implement policies, plans, programs, rules and regulations on real property valuation

or appraisal of LGUs in the region;

(b) Review, in coordination with the BIR, and endorse to the RPVS the proposed SMV's
prepared by the provincial assessors together with the municipal assessors, and the
city assessors in the region;

(c) Provide for economical, efficient and effective 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 regional electronic database of
all regional real property-related transactions, and have custody of all transaction
records submitted by local government assessors; and

() Perform other functions as may be assigned by the BLGF Executive Director.


Cor aneawne

uw
12
13
14
15
16
7
18
19
20
a
22
23
24
25
26
27
28
29
30
31
32
33

35
36
37
38
39
40
41
a2

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 each from the:

1. BIR - Regional Office;

.. DENR — Regional Office;

Head of regional organization of government assessors;

Head of regional organization of national government appraisers;

Head of private appraisal sector within the region; and

Head of bankers association within the region.

(b) The members of the Regional Consultative Committee must be performing valuation-
related functions in their respective agencies or 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

OaRONn

Director may invite resource persons on issues concerning real property valuation.

SEC. 10. Functions 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; concems 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 concems in general; and other matters as
may be determined by the Committee,

ARTICLE Ill
VALUATION AND APPRAISAL OF REAL PROPERTIES
Chapter 1
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, and maintain, 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 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
under this Act. The Secretary of Finance shall promulgate the rules and regulations for the
valuation and appraisal of real property pursuant to the provisions of this Act.


eavaneswne

see
2
13
14
15
16
7
18
19
20
2
22
23
24
25
26
27
28
29
30
31
32
33
34
35

36
37
38
39

4a
42

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 generally accepted international valuation standards.

SEC. 13. Preparation of Schedule of Market Values. — The provincial assessors
together with municipal assessors, and city assessors, including the municipal assessor in
Metropolitan Manila Area, shall prepare the SMV 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 DOF. The proposed SMV shall be 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 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, which shall take effect after fifteen (15) days upon
compliance with its publication requirements.

The DOF shall post in its official website the approved SMV and furnish the same to the
concerned LGU, through the BLGF, and the BIR.

SEC. 15. Setting Assessment Levels and Tax Rates. — The approved SMV shall be
transmitted to the 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 at least 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 tax burden that the Sanggunian will adopt. The concerned Sanggunian shall
enact the tax ordinance upon conduct of public hearings and proper consultations withinsixty


wor annaw

10
ote
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33

35
36
37
38
39
40
a1
42
43

(60) days from receipt thereof; otherwise, the existing ordinance onassessment 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 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 case of provinces, to approve the
same. Failure of the concemed 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 ratesshall 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, including all concemed municipal
halls, and city halls and in two (2) other conspicuous public places therein.

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

(a) For purposes of real property taxation, the approved SMV shall in no case be
adopted by the LGU less than six (6) months prior to the effectivity of the new
assessments 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.

(©) 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 may be used upon its effectivity.

Notwithstanding the provisions of existing laws to the contrary, failure to use the SMV
and conduct of general revision of assessment and property classification shall render an LGU
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 municipal assessors, and the city assessors, including the municipal assessor in
Metropolitan Manila Area, shall undertake an updating of their respective SMVs within two (2)
years from the effectivity of this Act. Thereafter, they shall undertake an updating of SMVs and
conduct of general revision of property assessments not earlier than three (3) years from the
date of last revision, but not later than five (5) years. The BLGF shall prepare the schedule for
the updatingof the SMVs in all provinces, cities and municipalities within the Metropolitan Manila
Area.


eVvnurawne

10
coe

12
13
14
15
16
17
18
19
20
2
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39

a
42

In case of any significant change inthe market where the property is located after the
said 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 together with the municipal assessors, and the city assessors,
including the municipal assessor in Metropolitan Manila Area, shall recommend revisions to
their existing SMV to the BLGF Regional Office, through the Regional Director of the BLGF
having jurisdiction over the LGU concerned.

Such revision/s 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 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 Information System. ~ 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 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 concemed 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: Provided, That the
Commissioner of Internal Revenue or his duly authorized representative shall be allowed
access to the database without need of prior approval: Provided, Finally, That non-submission
of the required documents to the BLGF will be subject to the provisions of Section 28 of this 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 system, undertake regular data cleansing and
computerize records management for the efficient performance of their duties and functions.
The National Government,thru the Department of Information and Communications Technology,
shall provide with appropriate equipment and connectivity, information and communications
technology platform, 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 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 municipal assessors, and city assessors, including the municipal
assessor in Metropolitan Manila Area, and 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 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 of Plans to 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 form 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. 24. Duty of Registrar of Deeds and Notaries Public to Assist the Provincial,
City, or Municipal Assessor. — It shall be the duty of the Registrar of Deeds and notaries
public to furnish, free of 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. Duty of Assessors fo 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 those of the geodetic engineers within one (1) month after the receipt of such data. The
BLGF's Regional Office shall record, process and make a summary report of the real property


wCoevanawne

om
2
13
14
15
16
7
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37

39
40
41
a2
43

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 municipality assessors and assistant assessors, as the case may be, in
accordance with the civil service law, rules and regulations, and the following guidelines:

(@) 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 Metropolitan Manila Area, the appointee shall be chosen from
the list of at least three (3) ranking eligible candidateswithin 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 programs through education and
training.

SEC. 27. Qualification of Local Government Assessors. ~ No person shall be
appointed assessor or assistant assessor unless suchperson is a citizen of the Philippines, a
resident of the region for a provincial or city assessoror assistant assessor, and of the province
for a municipal assessoror assistant assessor, a registered and licensed appraiser, of good
moral character, and shall 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 employee 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


i
2
3
4
5
6
7
8
9

10
1
12
13
14
15
16
a7
18
19
20
2
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41

pursuant to this Act, or deliberately conceals any deviations or departures 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 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. — 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 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. 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) 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. 32. Violations of Other Provisions. - 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. Taxpayers’ Remedies in Case of Erroneous Assessments of Real
Properties. - The provisions of Sections 226 on the Local Board of Assessment Appeals, and
2290n the Action by the Local Board of Assessment Appeals of Republic Act No. 7160,
otherwise known as the “Local Govemment Code of 1991", shall apply in all cases of appeal as
remedies for the taxpayers in the assessment of their properties.

All concerned local govemments shall cause the constitution of a fully functioning Local
Board of Assessment Appeals in their respective jurisdiction in coordination with the LRA.

ARTICLE V
TRANSITORY PROVISIONS

SEC. 34. Transitory Guidelines. — Local government units which are in the process of
updating 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.


wearvanrwune

a
12
13
14
15
16
7
18
19
20
2
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39

41

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 consideration as stated in real property
transaction documents, whichever is higher, for purposes of computing any intemal 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, municipal assessors including the
municipal assessors in 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 Intemal 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 updatingof the SMVs
and general revision of real property assessments, and the administration of real property taxes
in all LGUs.

The BLGF shall annually fuish the Department of Budget and Management (DBM) with
a list of LGUs whose SMVs are due for updating. The DBM, in their review of the ensuing year
budget of provinces, highly urbanized cities, independent component cities and municipalities
within the Metropolitan Manila Area, shall ensure that sufficient funds have been budgeted to
comply with the requirements of this Act; Provided, That failure to provide the appropriations
herein 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 concemed parties, shall issue the IRR for the
effective implementation of this Act.


wavanewne

cB
12
13
14
15
16
7
18
19
20
2
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41

SEC. 39. Suppletory Application of Existing Laws. — The provisions of Republic Act
No. 7160, otherwise known as the “Local Goverment Code of 1991”, and other laws consistent
with this Act shall repealed, superseded or modified accordingly.

SEC. 40. Separability Clause. — 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.

SEC. 41. Repealing Clause. —

(a) Sections 188, 199(0), 201, 202, 209 (a), 212, 214, 219, 220, 472 (a) paragraph 1,
472(b)(8), and 473(a) paragraph 1 of Republic Act No. 7160, otherwise known as the
“Local Govemment Code of 1991", are hereby repealed;

(b) Section 3 (n) of PD 464 of 1974 entitled “Enacting A Real Property Tax Code” is
hereby repealed;

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

(d) Section 4 (a) and (b) of Republic Act No. 8974, otherwise known as “AnAct To
Facilitate The Acquisition Of RightOfWay, Site Or Location For National
Government infrastructure Projects And For Other Purposes”are hereby repealed;

(€) Section 9 of PD 921 entitled, “Providing For The Administration Of Local Financial
Services In Metropolitan Manila, Creating Local Treasury And Assessment Districts
Therein, And For Other Purposes" is hereby repealed;

() Sections 19, 135 (a), 138, 198(a), 199(0), 218 and 224(a) of Republic Act No. 7160,
otherwise known as the “Local Goverment Code of 1991", are also amended or
modified accordingly;

(@) 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 entitled “Creating And Establishing The
PHIVEDEC Industrial Authority And Making It A Subsidiary Agency Of The Philippine
Veterans Investment Development Corporation Defining Its Powers, Functions And
Responsibilities, And For Other Purposes’ on the power of PHIVIDEC Industrial
Authority to collect real property tax; and

(i Alllaws, 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. 42. Effectivity. - This Act shall take effect fifteen (15) days after its publication
in the Official Gazette or in a newspaper of general circulation.

Approved.