Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

THIRTEENTH CONGRESS
First Regular Session

HNO. 07

INTRODUCED BY HONORABLE JUAN EDGARDO “SONNY” M. ANGARA

EXPLANATORY NOTE

The Philippines has a total land area of 30 million hectares, 47% or around 14.12 million
hectares of which are classified alienable and disposable. Had these lands been utilized
efficiently, agricultural productivity and food security would not be a critical problem as it is
today.

A document recently released by the National Economic Development Authority
(NEDA), “The Philippine National Development Plan, Directions for the 21" Century,” and
Coconut and the second to the lowest for rice. The Philippines had the lowest yields for corn and
coconut and the second to the lowest for rice. The Philippines, annual average growth rate yield
at 0.6 percent, was the lowest in ASEAN for the period 1986-1996,

It further showed that, according to the Food and Agriculture Organization (FAO), the
Philippines posted zero average growth rate in agricultural production during the period 1981 to
1990 in sharp contrast to the annual growth rate of at least four percent (4%) for Indonesia,
Malaysia, Vietnam, China, India and Pakistan during the same period. Form 1991 to 1993, the
Philippine agriculture sector posted a measly annual growth of 0.3 percent compared to
Malaysia’s 5.1%, Vietnam’s 4.9% and Indonesia's 4.2%.

It is lamentable to note that for a country with so much land resources, it lags behind
those with less, Filipinos, it seems, have taken for granted what classical economists are wont to
say, the “original gift of nature.” A trip down the country lanes would give us glimpses of large
tracts of privately-owned productive agricultural lands that have remained idle and undeveloped
over the years.

Several reasons have been cited to explain the continuing non-cultivation and non-
utilization of these lands but two obvious factors are land speculation and land conversion. Land
owners would rather have their lands remain idle than invest on inputs to the land such as
fertilizers, agricultural implements, new crop varieties, and irrigation, knowing that in time, its
market value would definitely doubled. Likewise they would rather seek the conversion of their
lands from agricultural to residential or commercial than engage in farming and similar activities
wherein they face higher risks of loss due to weather conditions.

This Bill seeks to increase the ceiling tax on idle lands from five percent (5%) to ten
Percent (10%) to give local government units (LGUs) more flexibility in its imposition. The
current maximum of five percent (5%) has not proven to be a deterrent against the non-
utilization of agricultural lands for productive purposes neither as a stimulant for LGUs to
maximize its revenue potentials,


There are moves to nationalize the imposition of the idle land tax but at this point when
LGUs are still learning the ropes of governance and self-sufficiency, it would be imprudent to
take away the power to impose this tax away from them. After all, what is the guarantee that
implementation and collection of the said tax at the national level would be more effective and
efficient than at the local level?

The five percent (5%) idle tax has been in existence since the 1970s but to date, it
remains, well, “idle”. If we were to make the idle land tax more dynamic, let us raised it by all
means but let us not deprive the LGUs the chance to partake in the “banquet”.

In view of the foregoing, early approval of this bill is earnestly sought.

Lone District, Province of Aurora


THIRTEENTH CONGRESS OF THE )

REPUBLIC OF THE PHILIPPINES )
First Regular Session )
107
H.B.No.

Introduced by HON. JUAN EDGARDO “SONNY” M. ANGARA

AN ACT
INCREASING THE TAX ON IDLE LANDS, AMENDING FOR THE PURPOSE,
SECTION 236 OF R. A. NO. 7160, OTHERWISE KNOWN AS THE LOCAL
GOVERNMENT CODE OF 1991

Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:

SECTION 1. Section 236 of Republic Act No. 7160 is hereby amended as follows

“SEC. 236. Additional Ad Valorem Tax on Idle Lands. — A province or city, of a
municipality within the Metropolitan Manila, may levy an annual tax on idle lands at the
rate not exceeding {five] TEN percent ((5%)] (10%) of the assessed value of the property
which shall be in addition to the basic real property tax.”

SEC. 2. All other acts, decrees, executive orders, rules and regulations, or part or parts
thereof, inconsistent with this Act are hereby repealed or modified accordingly.

SEC. 3. This Act shall take effect upon its publication in two (2) newspapers of general
circulation.

Approved,