FIFTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES =)
FIRST REGULAR SESSION )

HOUSE OF REPRESENTATIVES

Introduced by Representative Rufus B. Rodriguez and
Representative Maximo B. Rodriguez, Jr.

House Bill No. 4687

EXPLANATORY NOTE

The Philippine government is relentless in its quest towards tapping all
possible revenue resources to address the challenges in attaining good and
responsive governance and effective public service delivery every Filipino
deserves.

One of the most vaunted sources of revenues is real property, which is
considered as the most important natural resource and the biggest financial
asset. The World Bank reported that 50% to 75% of the country's wealth is
contained in land. Ironically, the ‘and market is contributing only 6% to the
Gross National Product. Char ized by inconsistencies and inefficiencies in
the land administration and management sector, specifically in real property
valuation, our country has failed to capture and maximize the huge potential
that the land sector offers.

The real property valuation system in the Philippines depicts a
depressing state of chaotic, inefficient, and inequitable layers of bureaucracy.
At least 23 national government agencies (NGAs) and more than 1,700 local
government units (LGUs) perform or require valuation functions and services
using varied systems and methodologies for different purposes, thus, resulting
to multiple, confusing, unrealistic, or outdated values for the same property.
The discrepancies in real property values have had considerable cost to the
goverment. Conflicting fand values resulted to right-of-way compensation
problems, lengthy court litigations arising from valuation disputes, project
delays, and unrealized revenues and socio-economic benefits. The system
has also caused huge disparities of taxable base for local and nationat
taxation, and revenue leakages due ta the absence of single market-based
valuation for taxation purposes, i.e., the Bureau of Internal Revenue imposes
zonal valuation for capital gains tax and other national land-related taxes,
while the local government units (LGUs) use the Schedule of Market Values
(SMV) as basis for real property tax.


The existing challenges in the land and real property valuation sector
have also meant the public's lack of confidence in real property values.
Instances of overvaluation and undervaluation, depending on the purpose of
transaction, have proliferated, thus, derailing the potential of the real property
sector in taking a leap towards contributing to the country’s economic
development.

The problems in real property valuation may be traced on the failure of
LGUs to correctly update the SMVs. While the Local Government Code (LGC)
requires the reguiar conduct of the general revision of SMVs and property
assessments every three years, LGUs have failed to comply with the
requirements of the law for lack of penal sanctions in the law and for fear of
political backlash arising from it. Expectedly, the resulting condition is a
stagnant, outdated, and highty politicized real property valuation that is
inconsistent with the realities of the market economy. SMVs have become
generally undervalued, and failed to reflect the real market conditions of the
real property sector—causing huge foregone revenues of the LGUs. The BIR,
on the other hand, has no statutory mandate for the regular revision and
Updating of the zonal values. Thus, this bilf seeks to improve real property
valuation for the government by adopting a market-based SMV to be used as
basis of focal and national real property taxation, and as benchmark for other
purposes as required by other government agencies and instrumentaiities, as
well as private entities.

Governed by internationally accepted valuation standards and best
practices, the LGU SMVs shall represent the real market conditions of their
fespective localities, with the aid of an effective national valuation database
system. In light of Republic Act No. 9646 or the Real Estate Service Act,
which now professionalizes and regulates the appraisal/valuation practice,
this bill also seeks to hamess the professional competence of local
government assessors and national goverment appraisers towards
developing and establishing and efficient and responsive valuation system in
the country. The VRA, as a complementary bill, becomes essential in
ensuring that professional appraisal/valuation operates in an environment that
is equitable, transparent, and objective.

In order to implement the reforms, the Bureau of Local Goverment
Finance (BLGF)under the Department of Finance,is proposed to be
reorganized and strengthened to provide the institutional support and
accountability to operationalize the reform agenda. The BLGF is envisioned to
‘oversee all matters relating to real property valuation in the country, while
taking the lead in reviewing the SMV of all LGUs for approval by the Secretary
of Finance, and compliance monitoring for the regular SMV revision by LGUs
By doing so, 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 bome out of initiatives to
correct and update their respective SMVs.

The passage of this bill is eamestly sought as a timely and
complementary measure to support the long-term revenue efforts of the


government. By enhancing the valuation systems and procedures in the local
governments, the bill will allow us to move towatd a more rational land
administration and management system that fully taps the potential of the real
property sector. In tum, the capacity of the government to generate more
revenues is enhanced, without necessarily imposing new tax measures or
increasing existing tax rates. Intended to be an instrument in enhancing local
autonomy, the bill will enable LGUs to achieving a more stable fiscal
wherewithal and a strengthened local real property tax base to fund service
delivery requirements of the LGUs, thereby achieving good and transparent
governance, and increased public confidence.

In view of the foregoing, immediate passage of this bill is eamestly
requested.

MAXIMO B. RODRIGUEZ, JR.


FIFTEENTH CONGRESS ,
REPUBLIC OF THE PHILIPPINES }?
FIRST REGULAR SESSION )

HOUSE OF REPRESENTATIVES

Introduced by Representative Rufus B. Rodriguez and
Representative Maximo B, Rodriguez, Jr.

House Bill No__ 4687

AN ACT

INSTITUTING REFORMS IN REAL PROPERTY VALUATION 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 Philiopines
in Congress assembled:

SEC. 1. Short Title— This Act shall be known as the "THE REAL PROPERTY
VALUATION REFORM ACT OF 2011."

ARTICLE!
DECLARATION OF 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
nrationatly consistent real property valuation based on intemationally accepted
valuation standards, concepts, principles, and practices. Towards this end, the State
shall:

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

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

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

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

(©) Support the development and professionalization of the
valuation‘appraisal practice in the country pursuant to Republic Act No.

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


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

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

‘SEC. 3. Definition of Terms.- As used in this Act, the following terms mean:

(@) Appraiser — also known as valuer; refers to 2 person who conducts
valuationfappraisal; specifically, one who possesses the necessary
qualifications, ability, and experience to execute or direct the
valuation/appraisal of real property.

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

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

{d) Improvements - is 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.

(e) 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 onty 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,
wikdlfe, timber, and fish, are fand within the technical meaning of the term:
s0 also are sources of energy, outside of man himself, such as water, coal
deposits, and the natural fertility of the soit.

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

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

(h) Private appraisal sector — refers to licensed non-govemmental 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 which are attached to
the land. It is the physical, tangible entity, together with all the additions or
improvements on, above oF below the ground.



(Real Property - refers to all the rights, interests, and benefits related to
the ownership of real estate, plant, machinery, and equipment;

(k) Schedule of Market Vatues or SMV — refers to a table of market values of
real properties within a local goverment unit prepared by assessors
pursuant to existing laws, rules and regulations.

() Special Purpose Property - refers to a property which 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 concem. Because of the special design and
function, conversion of special purpose properties to other types of
development or application is generally not economically feasible.

(mm) ValuatiorvAppraisal — 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,
logicat analysis and judgment as of a specific date and for a specific

purpose
ARTICLE Ii

STRENGTHENING THE BUREAU OF LOCAL GOVERNMENT FINANCE
Chapter 1

BLGF Central Operations

SEC. 4. Role of the Bureau of Loca Government Finance. - The Bureau of Local
Goverment Finance shall lead and manage the implementation of the provisions of
this Act. The BLGF shalt have the following powers and functions:

(@) Develop, adopt, and maintain valuation standards consistent with
generally accepted valuation standards, reguiations and specifications for
real property appraisal used for tax and other purposes, and ensure
compliance therewith by local goverment units and other concemed
parties;

{b) Review for compliance with the real property valuation policies and
standards and approve the Schedule of Market Values (SMVs) prepared
by the provincial assessors together with municipal assessors, and city
assessors, including the municipal assessor of Metro Manila, for tax and
other purposes;

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

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

(e) Maintain a roster of licensed local goverment 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;

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

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



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

‘SEC. §.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 Bureau of
Local Goverment Finance, which shall perform the functions pertaining to Sec.
hereof.

SEC. 6.Rasponsibilities of the BLGF Executive Director, - The BLGF Executive
Director shall be responsible for the efficient and effective performance of the
responsibilities set forth in this Act and for the overall intemal management and
governance of the RPVS. For this purpose, the BLGF Executive Director shall:

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

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

(©) Approve, upon review by the RPVS,the Schedule of Market’ Values
(SMVs) prepared by the provincial assessors together with municipal
assessors, and city assessors, including the municipal assessor of Metro
Manila, for tax and other purposes.

(d) Advise and assist other government agencies on matters pertaining to
real property valuationfappraisal, and

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

SEC. 7.Consultations with Concemed Agencies and Sectors. (a) A Central

Consuttative Committee shall be created, chaired by the BLGF Executive Director

ard composed of a representative ach fem

Bureau of Internal Revenue (BIR);

Cepartment of Environment and Natural Resources (DENR);

BangkoSentraingPilipinas (BSP),

National organization of government assessors;

Private appraisal sector, and

Union of Local Authorities of the Philippines (ULAP);

(b) The member-representatives from theBIR, OENR, and BSP must be
Performing valuation-ralated functions. The national organization of
government assessors, the private sector, and the ULAP shal be
Tepresented by their respactive heads of organization,

(©) The Chairperson and members of the Committee shall not receive
additional salary for the performance of their functions, but they 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.

SyeeNe

SEC. 8. Functions of the Central Consultative Committee. — The Central
Consuttative Commitee’ shail serve as the consultation forum on matters pertaining
(o the setting, adoption and maintenance of the valuation standards.


Chapter 2
BLGF Rogional Operations

SEC. 9. Role of the BLGF Regional Offices. - The BLGF Regional Offices, through
the Regional Director, shall have the responsibility on all matters relating to
valuatior/appraisal and the SMVs in the region, such as:

(a) Implement the provisions of this Act and related policies, plans, programs,
rules and regulations on real property valuation or appraisal of local
government units in the region;

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

(©) Provide economical, efficient, and effective service relating to the
implementation of the provisions of this Act in the region;

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

(e) Provide leadership and policy direction in the area of real property
valuation/appraisal to local gavemment units in the region;

(f) 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 goverment
assessors; and

{9) Perform other functions as may be assigned by the BLGF Executive
Director

SEC. 10. The Regional Consultative Committee. - (a) There shall be a Regional
Consultative Committee chaired by the BLGF Regional Director, and composed of a
representative each from:
1) Bureau of intemai Revenue - Regional Office;
2) Department of Environment and Natural Resources -Regional Office:
3) Regional organization of government assessors;
4) Private appraisal sector within the region; and
5) Bankers association within the region
(b) The members of the Regional Consultative Committee must be
performing valuation/appraisal related functions. Representatives from the
regional organization of goverment assessors, private appraisal sector,
and banking association within the region shall be represented by the
head of their respective organization.
(©) The Committee shai! meet at the initiation of the BLGF Regional Director
at least once every quarter, and shalt have as many meetings as the
BLGF Regional Director may deem necessary for the performance of its
functions.

SEC. 11. Functions of the Regional Consuttative Committee. - The Regional
Consuttatve Committee shall serve as a consuitation forum in the region for
discussion on developments in the local real property market; concerns of taxpayers,
chil society, and other stakeholders; outcome of Compliance Reporting in the region:
level of complaints and appeals; local goverment unit training in the region;
appraiser and assessor concerns in general; and other matters as may be
determined by the Committee.


ARTICLE Il
VALUATION/APPRAISAL OF REAL PROPERTIES

Chapter 4
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 shal! be used by all appraisers and
assessors in the local government units 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
valuation principles and internationally accepted standards.

SEC. 13, Valuation/Appraisal of Real Property. — For valuation purposes, all reat
Properties, whether taxable or exempt, shall be valued or appraised at the market
value prevailing in the locality where the property is situated, in conformity with the
valuation standards adopted under this Act. The BLGF shall promulgate the rules.
ang regulations for the valuatior/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 intemationaily accepted valuation
‘standards adopted under this Act.

SEC. 14. Preparation of Schedule of Market Vatues.-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 local goverment units, pursuant to the
valuation standards, rules, regulations and other specifications set by the DOF and
the BLGF. The said SMVs shall be submitted by the assessor concemed, copy
furnished the provincial govemor or the city mayor, as the case may be, and the
concemed Sanggunian, to the BLGF Regional Office for review and compliance with
other requirements not iater than the thirty-first (31°) day of October of the
immediately preceding calendar year the general revision of real property
assessments shall be undertaken. The said SMVs shail be reviewed by the BLGF
Regional Office within thirty (30) days upon receipt thereof, and shall then be
submitted by the same to the BLGF Central Office. The BLGF Executive Director,
after review by the RPVS, shall approve the SMV within sixty (60) days upon receipt
Of the same; otherwise, said schedule shall be deemed approved.

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


Upon the enactment by the Sanggunian of an Ordinance for the assessment
Jevels and tax rates, the local chief executive shall 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 concemed local chief
executive to act on the Ordinance within the prescribed period shall render the same
approved.

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

SEC. 15. Use of Schedule of Market Values, — The SMV as approved by the BLGF
shall be used for the general revision of real propertyassessmentsin local
government units, as basis for the determination of real property related taxes
imposed by national government agencies, and as benchmark for seal property
appraisal for other purposes. For purposes of computing any internat revenue tax,
the BIR Commissioner shall adopt the SMV or the actual price in consideration as
stated in real property transaction documents, whichever is higher.

Notwithstanding the provisions of existing laws to the contrary, the SMV shall
cease as basis for the determination of national and local real property related taxes
alter five (5) years from theeffectwity of its enacting Ordinance.

SEC. 16. Revision of Schedule of Market Values. = The BLGF shall formulate the
program for the reguiar revision of SMVs. All provincial assessors together with the
municipal assessors, and 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 eattier than three (3) years from the date of last
revision, but not later than five (5) years.

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

SEC. 17.Conduct of Capacity Building Interventions. - For the effective .
implementation of this Act, the BLGF shall develop and conduct the necessary
trainings for all local assessors and other local officials/staff on the preparaton of
SMV in accordance with intemationally accepted valuation standards, concepts,
Principles and practices; conduct of SMV impact studies; preparation of compliance
reports, and other subject areas to ensure the effective implementation of this Act.

Chapter 2
Development and Maintenance of Real Property Database

‘SEG. 18. Development of Reat Property Database. — The BLGF shall develop and
maintain an up-to-date electronic database of the sale, exchange, lease, mortgage,
donation and all other real property transactions in the country and on the cost of
construction or renovation of buildings and other structures, and on prices of


machinery. For this purpose, the BLGF is hereby authorized to require the mandatory
‘submission of necessary documents from the concemed officials or employees of
national government offices or instrumentalities, focal 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 as well.

SEC. 19. Duty of Register of Deeds to Supply Assessors of Real
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 his/her registry every three (3) months and copies of afl contracts selling,
transferring or otherwise converting, leasing, or mortgaging real property registered
by himvher 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 of other forms of allenation.

‘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 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 al 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 Manageynent 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 concemed BLGF Regional Officeall real
Property transactions data from the Register of Deeds, official issuing building permit
and geodetic engineers within one (1} month after the receipt of such data. The
BLGF's Regional Office shal! 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 af such data,

Chapter 3
Appointment and Qualifications of Assessors

SEC. 23.Appointment of Assessors. — Notwithstanding the provisions of existing
laws to the contrary, appointments of provincial, city, and municipal assessors and
assistant assessors shal! be in accordance with the following guidelines:

(a) In the case of provincial and assistant provincial assessors and city and
assistant city assessors, appointee shall be chosen from the list of at least
three (3) ranking eligible recommendees suitable and qualified for
appointment within the region;

{b) In the case of municipal and assistant municipal assessors, appointee
‘shall be chosen from the list of at least three (3) ranking eligible


recommendees suitable and qualified for appointment within the province;
and
{e) In the case of city and assistant city assessors and municipal and
assistant municipal assessors for Metro Manila, appointee shall be
chosen from the list of at least three (3) ranking eligible recommendees
Suitable and qualified for appointment within the Metro Manila,
‘The assessors shat! be under the technical supervision of the BLGF, primarily
through a system of compliance reporting and pravision for education and training for
capacity building

SEC. 24.Quaiifications of Local Government Assessors, No person shall be
appointed assessor or assistant assessor unless such person is a citizen of the
Philippines, a resident of the region for a provincial or city assessor/assistant
assessor and of the province for a municipal assessor/assistant assessor, a
registered and licensed appraiser, of good moral character, and must have an
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.

ARTICLE IV
PENAL PROVISIONS

SEC. 26, 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 18, 19, 20, 21, and 22of this
Act shall be punished by a maximum fine equivalent to the official's or employee's six
(6) months basic salary or suspension from 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 concealed any deviations or departures
from such standards in the valuatior/appraisal of real property, shall be punished by
a maximum fine equivalent to the official's or employee's six (6) months basic salary,
and suspension from the government service.

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 the maximum fine equivalent to
the official's or employee's six (6) months basic salary, or by suspension from
government service for not more than one (1) year, or both, at the discretion of the
competent authority.

SEC. 28. Violations of Other Provisions.— Any person, whether natural or juridical,
who violates any provision of this Act other than those punishable under Sections 25,

26, and 27 hereof shall, when warranted, be dealt with under applicable existing
faws.

SEC, 29. Taxpayers’ Remedies in Case of Erroneous Assessments 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 Goverment Code of 1991 shall apply in ail
cases of appeals as remedies for the taxpayers in the assessment of their properties.


ARTICLE V
TRANSITORY PROVISIONS

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

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

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

ARTICLE VI
FUNDING REQUIREMENTS

SEC. 32. Budgetary Requirements for Revision of Schedule of Market Values. —
Each local Sanggunian shall appropriate the necessary funds either from locally
generated revenues, the intemal Revenue Allotment (IRA), or other possible sources
every fiscal year. The accumulated amount so appropriated shall be known as the
Real Property Tax Administration Fund (RPTAF) which shall be used to ensure the
proper implementation of the regular revisions of the SMVs and general revision of
property assessments, and the administration of real property taxes in all local
government units.

‘SEC. 33. Appropriations. ~ The amount necessary for the initial implementation of
this Act shali be charged against the current appropriations of the BLGF. Thereafter,
such sum for the continuing operations and the proper implementation of this Act
shall be included in the annuai 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, upon conducting consultations with concemed
parties, shail issuethe 1RR 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 Goverment Code of 1991, and other
laws consistent with this Act shail have suppietory effect.

SEC. 36. Repealing Clause. a) Section &(E) of Republic Act No. 8424, ctherwise
known as the National intemal Revenue Code (NIRC), as amended, and Sections
1994), 201, 209(a), 212, 214, 219, 224(a), 472(a) par 1, and 473(a) par 1 of Republic
Act No. 7160, otherwise known as the Local Government Code (LGC) of the
Philippines, are hereby repealed;


{b) Sections 19, 135(a), 138, 198(aXgXh)(I), 202, 218par1(b), 220, 443{d),
444(b)(1)(v), 454(d), 455(d)(1)(v), 463(d), and 485(b){1)(v), 472(b)(8) of the LGC,
and Section 88(8) of the NIRC are hereby modified accordingly;

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

SEC. 37. Separabitity Clause. ~ Any portion or provision of this Act that may be
declared unconstitutional or invalid shall not have the effect of nulltying other
Portions or provisions hereof, as fong as such remaining portions or provisions can
stil subsist and be given effect in their entirety.

SEC. 38.Effectivity. — This Act shall take effect fifteen (15) days after its complete
Publication in the Official Gazette or in at least two (2) newspapers of general
caculation.

Approved,