HOUSE. OF REP R
RECEIVED
Republic of the Philippines 13 JUL 2013

HOUSE OF REPRESENTATIVES RAT
Quezon City, Metro Manila TIME:

BY:

Seventeenth Congress

= ;
irst Regular Session aae TRON Ger

anv
1529 BILLS NO INDEX SERVICE

HOUSE BILL NO.

Introduced by Honorable Alexandria P. Gonzales

EXPLANATORY NOTE

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

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

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outdated.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

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


in real property taxation by separating the valuation and assessment function from tax
setting and political influence is also imperative.

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

market.

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

ALEXANIPRIA P. GONZALES:


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

Seventeenth Congress
First Regular Session
1829

HOUSE BILL NO.

Introduced by Honorable Alexandria P. Gonzales

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 I
DECLARATION OF STATE POLICY AND OBJECTIVES,
AND DEFINITION OF TERMS.

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

concepts, principles, and practices, Towards this end, the State shall:


(a)

(b)

(d)

(g)

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

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

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;

Separate the function of valuing or appraising of real properties from
the functions of tax policy and administering the taxes due thereon;
Support the development and professionalization of the valuation and
appraisal practice in the country pursuant to Republic Act No. 9646,
otherwise known as the “Real Estate Service Act of the Philippines”;
Provide a comprehensive and up-to-date electronic database of all real
property transactions;

Support the development of an information database on valuation by

the

continuing research and monitoring of new developments

valuation discipline for upgrading the country’s valuation and keeping
it abreast with global developments; and
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 refers to a natural person who conducts valuation and

appraisal; specifically, one who possesses the necessary qualifications,


(b)

(c)

(d)

(e)

license, ability, and experience to execute or direct the valuation and
appraisal of real property; also known as valuer;

Assessor refers to an official in the local government unit (LGU) who
isa 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;
Improvements refer to 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 ot utility, or to adapt it
for new or further purposes;

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

man himself, such as water, coal deposits, and the natural fertility of

the soil;
Machinery 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


(g)

@

(k)

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

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

Real estate refers to the land and all those items that are attached to

the land. It is the physical, tangible entity, together with all the
additions or improvements on, above or below the ground;

Real property refers to all the rights, interests, and benefits related to
the ownership of real estate, plant, machinery, and equipment;
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 an LGU prepared by assessors pursuant to existing

laws, rules and regulations;


(1) Special purpose property refers to a property that is designed,
constructed and developed for a specific use ot 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

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

specific date and for a specific purpose.

ARTICLE IL
STRENGTHENING THE BUREAU OF LOCAL GOVERNMENT FINANCE
(BLGF)

Chapter 1
BLGF Central Operations
SEC. 4. Role of the Bureau of Local Government Finance (BLGF). ~ The BLGF,
through the Real Property Valuation Service (RPVS) as hereinafter established, shall lead
and manage the implementation of the provisions of this Act. The BLGF shall have the
following powers and functions:
(a) Develop, adopt, and maintain valuation standards consistent with

generally accepted valuation standards, regulations and specifications


(b)

(c)

(g)

for real property appraisal used for tax and other purposes, and ensure

compliance therewith by LGUs and other concerned parties;

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

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;

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 trainings and seminars;

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 base on current global and country trends and

developments in real property valuation and appraisal;



(h)

(0)

Determine, fix, and collect reasonable amounts 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

policy and objectives declared in this Act, there shall be established the Real Property

Valuation Service, hereinafter referred to as the RPVS, within the BLGF.

SEC. 6. Responsibilities of the BLGF Executive Director. - The BLGF Executive

Director shall ensure the efficient and effective performance of the responsibilities set forth

in this Act and for the overall internal management and governance of the RPVS. For this

purpose, the BLGF Executive Director shall:

(a)

(b)

(c)

(d)

(e)

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

Provide policy direction and leadership in all aspects of valuation and
appraisal and their implementation in the regional offices;
Recommend to the Secretary of Finance the approval of the SMVs
prepared by the provincial assessors, together with municipal assessors
and city assessors, including the municipal assessor in Metro Manila,
for tax, both local and national, and other purposes;

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

Perform such other functions as may be provided by law, or required in

pursuance of this Act.


SEC. 7. Creation of Central Consultative Committee. — (a) A Central Consultative

Committee shall be created, chaired by the BLGF Executive Director and composed of a

representative each from the:

(c)

(d)

(1) Bureau of Internal Revenue (BIR);

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

(3) Bangko Sentral ng Pilipinas (BSP);

(4) National organization of government assessors;

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

(6) Private appraisal sector; and

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

The member-representatives from the BIR, the DENR and the BSP

must be performing valuation-related functions. The national

organization of government assessors, the national organization of

appraisers in national government agencies, the private appraisal

sector and the ULAP shall be repr

ented by their respective heads of

‘The Chairperson and members of the Committee shall not receive
additional salary for the performance of their functions. Members of
the 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.


SEC. 8. Functions of the Central Consultative Committee. — The Central

Consultative Committee shall serve as the consultative forum on matters pertaining to the

setting, adoption, and maintenance of the valuation standards

Chapter 2

BLGF Regional Operations

SEC. 9. Role of the BLGF Regional Offices. - The BLGF Regional Offices, through

the Regional Director, shall be responsible for all matters relating to valuation and appraisal

and the SMVs in the region, such as the:

(a)

(b)

(e)

Implementation of the provisions of this Act and related policies,
plans, programs, rules and regulations on real property valuation or
appraisal of LGUs in the region;

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

Provision for economical, efficient and effective service relating to the
implementation of the provisions of this Act in the region;
Coordination and consultation with regional offices of other
government departments, bureaus and agencies within the region
dealing with real property valuation and appraisal to LGUs in the
region;

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

Adoption and maintenance of a comprehensive and up-to-date

regional electronic database of all regional real property-related


transactions, and have custody of all transaction records submitted by
local government assessors; and

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

SEC. 10. The Regional Consultative Committee. — (a) There shall be a Regional
Consultative Committee which shall be chaired by the BLGF Regional Director and shall be
composed of a representative each from the:

(1) BIR - Regional Office;

(2) DENR - Regional Office;

(3) Regional organization of government assessors;

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

(6) Bankers association within the region.

(b) The members of the Regional Consultative Committee must be
performing valuation and appraisal-related functions. Representatives
from the regional organization of government assessors, regional
organization of national government appraisers, private appraisal
sector, and bankers association within the region shall be represented
by the head of their respective regional organization.

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

SEC. 11. Functions of the Regional Consultative Committee. — The Regional
Consultative Committee shall serve as 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; LGU training in the region; appraisal and assessment concerns in general; and other

matters as may be determined by the Committee.

ARTICLE IIL
VALUATION AND APPRAISAL OF REAL PROPERTIES

Chapter 1
Valuation Standards and Market Values

SEC. 12. Development of Valuation Standards. ~

Notwithstanding the provisions of
existing laws to the contrary, the BLGF shall develop, adopt, maintain and implement
uniform valuation standards which shall be used by all appraisers and assessors in the LGUs
and other concerned parties in appraising or valuing lands, buildings, machinery and other
real properties for taxation and other purposes. The valuation standards shall conform with
generally accepted international valuation standards and principles.

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

For real properties intended for low-cost or socialized housing and other programs of

the government imbued with social policy objectives, the provisions of existing pertinent



laws shall be applied after determination of the prevailing market value of these properties in
accordance with internationally accepted valuation standards adopted under this Act.

SEC. 14. Preparation of Schedule of Market Values. ~ Provincial assessors,
together with municipal assessors and city assessors, including the municipal assessor in
Metro Manila, shall prepare the SMVs for the different classes of real property situated
within their respective LGUs, pursuant to the valuation standards, rules, regulations and
other specifications set by the Department of Finance (DOF) and the BLGF. The SMVs
shall be submitted by the assessor concerned to the BLGF Regional Office for review and
compliance with other requirements not later than the thirty-first (31st) day of October of
the immediately preceding calendar year that the general revision of real property
assessments shalll be undertaken. A copy thereof shall be furnished the concerned
sanggunian and the provincial governor, the municipal mayor, or the city mayor, as the case
may be.

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

The approved SMV shall be transmitted to the concemed assessor who shall confer
with the local chief executive regarding the approved SMV. Likewise, the concerned assessor
shall submit to the local chief executive a tax impact report of the new SMV as against the
existing assessment levels and tax rates, and shall provide the sanggunian, through the
Chairperson of the sanggunian’s Committee on Ways and Means or its equivalent, a copy of
the report. The local chief executive shall transmit the approved SMY, together with the tax
impact report, within fifteen (15) days from receipt of the same to the sanggunian for the

enactment of an ordinance setting the appropriate assessment levels and tax rates. The


concerned sanggunian shall enact such ordinance, upon the conduct of public hearings and

proper consultations, within sixty (60) days from receipt thereof; otherwise, the exis

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

The approved ordinance, together with the SMY, shall be published by the
concerned LGU in a newspaper of local circulation once a week for two (2) consecutive
weeks: Provided, however, That in provinces, cities and municipalities where there are no

newspapers of local circulation, the same shall be posted in the provincial ca

tol, city or
municipal hall and in two (2) other conspicuous public places therein. A list of LGUs whose
SMVs have been approved shall be posted in the BLGF official website.

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

Notwithstanding the provisions of existing laws to the contrary, the SMV shall cease
to be the basis for the determination of national and local real property-related taxes five (5)
years after the effectivity of its enacting ordinance.

SEC. 16. Revision of Schedule of Market Values. - The BLGF shall formulate the

program for the regular revision of SMVs. A\ll provincial assessors, together with the


municipal assessors and the city assessors, including the municipal assessor in Metro Manila,
shall undertake a revision of their respective SMVs within two (2) years from the effectivity
of this Act. Thereafter, they shall undertake a general revision of SMVs and property
assessments not earlier than three (3) years from the date of last revision, but not later than
five (5) years.

is located after the

In case of any significant change in the market where the property
said SMYs have been approved and prior to the next revision, or where correction of errors

and inequalities in any SMV is deemed necessary, the provincial assessors, together with the

municipal assessors and the city assessors, including the municipal assessor in Metro Manila,

may recommend to the BLGF Executive Director revisions to their existing SMV. The

revision/s shall be subject to review by the concerned BLGF Regional Office and the
recommendation by the BLGF Executive Director for approval by the Secretary of Finance
within ninety (90) days from the date of receipt.

SEC. 17. Conduct of Capacity Building Interventions. - For the effective

implementation of this Act, the BLGF shall develop and conduct the necessary training for
all local assessors and other local officials and staff on the preparation of the SMV in
accordance with internationally accepted 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 Database
SEC. 18, Development of Real Property Database. - The BLGF shall develop and
maintain an up-to-date electronic database of the sale, exchange, lease, mortgage, donation
and all other real property transactions in the country and on the cost of construction or

renovation of buildings and other structures, and on the prices of machinery. For this


ibmission of necessary

purpose, the BLGF is hereby authorized to require the mandatory s
documents from the concerned officials or employees of national government offices or
instrumentalities, LGUs and the private sector. The updated database shall be made

available to the LGU:

national government agencies and the private sector.

SEC. 19. Duty of Register of Deeds to Supply Assessors with Real Property
Transactions Data. ~ The Register of Deeds shall prepare and submit to the provincial and
city assessors, including the municipal assessor in Metro Manila, an abstract of the entire

registry every three (3) months and copies of all contracts selling, transferring or otheru

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 and shalll be
accompanied by copies of corresponding deeds of sale, donation or partition or other forms of
alienation.

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

SEC. 21. Duty of Geodetic Engineers to Furnish Copy of Plans to Assessor. — It
shall be the duty of all geodetic engineers, public ot private, to furnish free of charge, the
assessor of the province, city or municipality where the land is located, a copy of the blue or
white print of each of all approved original subdivision plans or maps of surveys, duly signed

by a senior geodetic engineer, executed by them every end of the month from receipt of such


approved plans from the Land Management Bureau (LMB), the Land Registration Authority

(LRA), or the Housing and Land Use Regulatory Board (HLURB), as the case may be.

SEC. 22. Duty of Assessors to Transmit Documents to the BLGF. - It shall be the

duty of the assessors to transmit to the concerned BLGF Regional Office all real property

transactions data from the Register of Deeds, and the names of the official issuing the

building permit and those of the geodetic engineers within one (1) month after the receipt

of such data. The BLGF Regional Office shall record, process and make a summary report of

the real property data and submit the same to the BLGF Central Office within one (1)

month from receipt of such data.

Chapter 3

Appointment and Qualifications of Assessors

SEC. 23. Appointment of Assessors. ~ The local chief executive shall appoint the

provincial, city and municipal assessors and assistant assessors, as the case may be, in

accordance with civil service law, rules and regulations and the following guidelines:

(a)

(b)

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 recommendees within the region, as
endorsed by the DOF Secretary as suitable and qualified for
appointment;

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

In the case of city and assistant city assessors and municipal and

assistant municipal assessors for Metro Manila, the appointee shall be


chosen from the list of at least three (3) ranking eligible

recommendees within Metro Manila, as endorsed by the DOF
Secretary as suitable and qualified for appointment.

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

SEC. 24. Qualifications of Local Government Assessors. — No person shall be
appointed assessor or assistant assessor unless one is 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 appraiser, and of good moral
character. The appointee must have experience in real property valuation or assessment
work or in any suitable field for at least five (5) years in the case of the provincial or city
assessor, and three (3) years in the case of the municipal assessor.

All incumbent assessors holding permanent appointments shalll enjoy security of
tenure and shall continue to perform their functions without the need for reappointment
and without diminution of status, rank and salary grade. Those with temporary appointments
shall be given the opportunity to qualify for permanent appointment as assessor or assistant

assessor within a period to be determined by the DOF upon the effectivity of this Act.

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

punished by a fine equivalent to the official’s or employee's six (6) months basic salary, or by


suspension from the government service for a period not exceeding one (1) year, or both, at

the discretion of the competent authority.

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

SEC. 27. 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
government service for not more than one (1) year, or both, at the discretion of the
competent authority

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

SEC. 29. Taxpayers’ Remedies in Case of Erroneous Assessment of Real
Properties. — The provisions of Sections 226 (Local Board of Assessment Appeals) and 229
(Action by the Local Board of Assessment Appeals) of Republic Act No. 7160, otherwise
known as the “Local Government Code of 1991”, shall apply in all cases of appeals as

remedies for the taxpayers in the assessment of their properties.


ARTICLE V
TRANSITORY PROVISIONS
SEC. 30. Transitory Guidelines. — (a) LGUs which are in the process of revising
their SMVs, upon the effectivity of this Act, shall continue with such revisions in
accordance with Section 16 of this Act: Provided, That proper notification and coordination
with the BLGF shall be undertaken.
(b) Incase the SMV is not yet available or revised, the BIR Commissioner

shall adopt the existing SMV, zonal values or the actual price in

consideration as

ated in real property transaction documents,
whichever is higher, for purposes of computing any internal revenue
tax.

SEC. 31. Saving Clause. ~ The zonal values, as determined by the BIR and approved
by the Secretary of Finance for internal revenue tax purposes, and the SMVs prepared by the
provincial assessors, together with the municipal assessors and the city assessors, including
the municipal assessor in Metro Manila, that have been approved by their respective
sanggunians for real property taxation purposes shalll continue to be in force and effect until
repealed, superseded, modified, revised, set aside, or replaced by the values provided under

the new SMVs as approved in accordance with Section 16 of this Act, which shall be within

two (2) years upon the effect

ty of this Act.

ARTICLE VI
FUNDING REQUIREMENTS
SEC. 32. Budgetary Requirements for the Revision of Schedule of Market Values.
~ Each local sanggunian shall appropriate the necessary funds from locally generated

revenues, the Internal Revenue Allotment (IRA), or such other sources every fiscal year.


The accumulated amount so appropriated shall be known as the Real Property Tax
Administration Fund (RPTAF) which shall be used for the proper implementation of the
regular revision of the SMVs and the general revision of real property assessments, and the
administration of real property taxes in all LGUs.

SEC. 33. Appropriations. — The amount necessary for the implementation of this

‘Act shall be included in the annual General Appropriations Act.

ARTICLE VII
MISCELLANEOUS PROVISIONS

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

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

SEC. 36. Repealing Clause. ~ (a) Sections 19, 135(a), 138, 198(a), 199(¢)(h)(I),

201, 202, 209%(a), 212, 214, 218 paragraph 1(b), 219, 220, 224(a), 443(d), 444(b)(I)(v),

454(d), 455(b)(1)(v), 463(d), 465(b)(I)(v), 472(a) paragraph 1, 472(b)(8), and 473(a)
paragraph 1 of Republic Act No. 7160, otherwise known as the “Local Government Code of
1991”, are hereby repealed;
(b) Sections 6(E), 24(D), 27(D)(5), Sections 88(B) and 102 of Republic
Act No. 8424, otherwise known as the “Tax Reform Act of 1997”, are
hereby amended or modified accordingly.

(c) All laws, presidential decrees, executive orders, presidential

proclamations, rules and regulations or parts thereof contrary to ot



inconsistent with the provisions of this Act are hereby repealed,
superseded or modified accordingly
SEC. 37. Separability Clause. - If any section ot provision of this Act shall be
declared unconstitutional or invalid, the other sections or provisions not affected thereby

shall continue to be in full force and effect

SEC. 38. Effec — This Act shall take effect fifteen (15) days after its complete

publication in the Official Gazette or in a newspaper of general circulation

Approved,