FOURTEENTH CONGRESS OF THE REPUBLIC ) 
OF THE PHILIPPINES 
1 
First Regular Session 
) 
Introduced by Senator Miriam Defensor Santiago 
EXPLANATORY NOTE 
Real property tax (WT) is the single major source of income of local governments. It 
accounts for roughly 36% of total locally-generated income of LGUs. However, the Commission 
on Audit (COA) bared that only 54% of the total potential tax take are actually collected. There 
are several reasons raised why there is an apparent under collection of real property taxes: 
(1) There is no uniform method of appraising real properties among local governments - 
i.e., two similar assets located in two different but adjacent jurisdictions may bear different RPT 
burdens. (2) Revision or updating of the schedule of fait: market values is so infrequent, thus, 
resulting in a low tax base even as assets in the market continue to appreciate. (3) The approval 
of the schedule of fair market values is vested on the Sanggunian PanlalawiganRanlungsod. 
Considering the political nature of the local Sanggunian, the tendency is to forego revisions in 
the valuation schedule or to keep the property values understated. 
It is important, therefore, that the approval of the schedule of fair market values be 
transferred fiom the local Sanggunian to the Department of Finance (DOF) upon review and 
recommendation of a Regional Technical Valuation Committee. The power to determine the 
assessment levels and tax rates, however, shall remain with the local Sanggunian. 
The Committee shall be composed of the local assessors, and regional representatives 
from the Bureau of Local Government Finance (BLGF), the Bureau of Internal Revenue (BIR), 
and the private sector. The same Committee will seek to harmonize the valuation method used by 
the different local government units, national government agencies, and the private sector. 
This is a senate counterpart bill to one filed in the House of Representatives by Rep. Jose 
De Venecia, Jr. 


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FOURTEENTH CONGRESS OF THE REPUBLIC ) 
OF THE PHILIPPINES 
1 
First Regular Session 
1 
S. No. "W83 
Introduced by Senator Miriam Defensor Santiago 
AN ACT 
AMENDING SECTIONS 212 AND 214 OF REPUBLIC ACT 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 212 of the Local Government Code of 1991 is hereby amended to 
read as follows: 
SEC. 212. Preparation of Schedule of Fair Market Values. - Before any general 
revision of property assessment is made pursuant to the provisions of this Title, [there 
shall be prepared a schedule of fair market values by the provincial, city and the 
municipal assessors of the municipalities within the Metropolitan Manila Area for the 
different classes of real property situated in their respective local government units for 
enactment by ordinance of the sanggunian concerned.] A SCHEDULE OF FAIR 
MARKET VALUES SHALL BE PREPARED BY A REGIONAL TECHNICAL 
VALUATION COMMITTEE FOR FINAL APPROVAL OF THE SECRETARY OF 
FINANCE. 
THE REGIONAL TECHNICAL VALUATION COMMITTEE SHALL BE 
COMPOSED OF THE PROVINCIAL, CITY AND MUNICIPAL ASSESSORS OF 
MUNICIPALITIES WITHIN THE METROPOLITAN MANILA ARBA, AND ONE 
REPRESENTATIVE EACH FROM THE BUREAU OF LOCAL GOVERNMENT 
FINANCE (BLGF), THE BUREAU OF INTERNAL REVENUE (BIR), AND THE 
PRIVATE SECTOR. THE REPRESENTATIVE FROM THE PRIVATE SECTOR 
MUST BE DIRECTLY INVOLVED IN REAL ESTATE APPRAISAL. 
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SECTION 2. Section 214 of the Local Government Code of 1991 is hereby amended to 
read as follows: 
SEC. 214. Amendment of Schedule of Fair Market Values. - The [provincial, city 
or municipal assessor] REGIONAL TECHNICAL VALUATION COMMITTEE may 
recommend to the [sanggunian] SECRETARY OF FINANCE concerned amendments to 
correct errors in valuation of the schedule of fair market values. The [sanggunian] 
SECRETARY concerned shall, [by ordinance.] act upon the recommendation within 
ninety (90) days from receipt thereof. 
SECTION 3. Effectivity. - This Act shall take effect fifteen (15) days following its 
Publication in two (2) newspaper of general circulation. 
Approved, 
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