THE
LOCAL GOVERNMENT CODEOF
THE PHILIPPINES
BOOK
IILOCAL TAXATION AND FISCAL MATTERSTITLE ONE. - LOCAL
GOVERNMENT
TAXATIONCHAPTER 1 - GENERAL
PROVISIONS
SEC. 128. Scope.- The
provisions herein shall govern the exercise by provinces, cities,
municipalities,
and barangays of their taxing and other revenue-raising powers.
SEC. 129. Power to Create
Sources of Revenue. - Each local government unit shall exercise its
power to create its own sources of revenue and to levy taxes, fees, and
charges subject to the provisions herein, consistent with the basic
policy
of local autonomy. Such taxes, fees, andcharges shall accrue
exclusively
to the local government units.cralaw:red
SEC. 130. Fundamental
Principles. - The following fundamental principles shall govern the
exercise of the taxing and other revenue-raising powers of local
government
units:chanrobles virtual law library
(a) Taxation shall
be uniform in each local government unit; (b) Taxes, fees, charges and
other impositions shall:chanrobles virtual law library
(1) be equitable and
based as far as practicable on the taxpayer's ability to pay;
(2) be levied and collected
only for public purposes;
(3) not be unjust,
excessive, oppressive, or confiscatory;
(4) not be contrary
to law, public policy, national economic policy, or in restraint of
trade;
(c) The collection of local
taxes, fees, charges and other impositions shall in no case be let to
any
private person;
(d) The revenue collected
pursuant to the provisions of this Code shall inure solely to the
benefit
of, and be subject to disposition by, the local government unit levying
the tax, fee, charge or other imposition unless otherwise specifically
provided herein; and,
(e) Each local government
unit shall, as far as practicable, evolve a progressive system of
taxation.cralaw:red
SEC. 131. Definition of
Terms. - When used in this Title, the term:chanrobles virtual law library
(a) "Agricultural Product"
includes the yield of the soil, such as corn, rice, wheat, rye, hay,
coconuts,
sugarcane, tobacco, root crops, vegetables, fruits, flowers, and their
by-products; ordinary salt; all kinds of fish; poultry; and livestock
and
animal products, whether in their original form or not. The phrase
"whether
in their original form or not" refers to the transformation of said
products
by the farmer, fisherman, producer or owner through the application of
processes to preserve or otherwise to prepare said products for the
market
such as freezing, drying, salting, smoking, or stripping for purposes
of
preserving or otherwise preparing said products for the market;
(b) "Amusement" is
a pleasurable diversion and entertainment. It is synonymous to
relaxation,
avocation, pastime, or fun;
(c) "Amusement Places"
include theaters, cinemas, concert halls, circuses and other places of
amusement where one seeks admission to entertain oneself by seeing or
viewing
the show or performances;
(d) "Business" means
trade or commercial activity regularly engaged in as a means of
livelihood
or with a view to profit;
(e) "Banks and other
financial institutions" include non-bank financial intermediaries,
lending
investors, finance and investment companies, pawnshops, money shops,
insurance
companies, stock markets, stock brokers and dealers in securities and
foreign
exchange, as defined under applicable laws, or rules and regulations
thereunder;
(f) "Capital Investment"
is the capital which a person employs in any undertaking, or which he
contributes
to the capital of a partnership, corporation, or any other juridical
entity
or association in a particular taxing jurisdiction;
(g) "Charges" refer
to pecuniary liability, as rents or fees against persons or property;
(h)
"Contractor" includes persons, natural or juridical, not subject to
professional
tax under Section 139 of this Code, whose activity consists essentially
of the sale of all kinds of services for a fee, regardless of whether
or
not the performance of the service calls for the exercise or use of the
physical or mental faculties of such contractor or his employees.cralaw:red
As used in this Section,
the term "contractor" shall include general engineering, general
building
and specialty contractors as defined under applicable laws; filling,
demolition
and salvage works contractors; proprietors or operators of mine
drilling
apparatus; proprietors or operators of dockyards; persons engaged in
the
installation of water system, and gas or electric light, heat, or
power;
proprietors or operators of smelting plants; engraving, plating, and
plastic
lamination establishments; proprietors or operators of establishments
for
repairing, repainting, upholstering, washing or greasing of vehicles,
heavy
equipment, vulcanizing, recapping and battery charging; proprietors or
operators of furniture shops and establishments for planing or
surfacing
and recutting of lumber, and sawmills under contract to saw or cut logs
belonging to others; proprietors or operators of dry- cleaning or
dyeing
establishments, steam laundries, and laundries using washing machines;
proprietors or owners of shops for the repair of any kind of mechanical
and electrical devices, instruments, apparatus, or furniture and shoe
repairing
by machine or any mechanical contrivance; proprietors or operators of
establishments
or lots for parking purposes; proprietors or operators of tailor shops,
dress shops, milliners and hatters, beauty parlors, barbershops,
massage
clinics, sauna, Turkish and Swedish baths, slenderizing and building
saloons
and similar establishments; photographic studios; funeral parlors;
proprietors
or operators of hotels, motels, and lodging houses; proprietors or
operators
of arrastre and stevedoring, warehousing, or forwarding establishments;
master plumbers, smiths, and house or sign painters; printers,
bookbinders,
lithographers; publishers except those engaged in the publication or
printing
of any newspaper, magazine, review or bulletin which appears at regular
intervals with fixed prices for subscription and sale and which is not
devoted principally to the publication of advertisements; business
agents,
private detective or watchman agencies, commercial and immigration
brokers,
and cinematographic film owners, lessors and distributors.cralaw:red
(i) "Corporation" includes
partnerships, no matter how created or organized, joint-stock
companies,
joint accounts (cuentas en participacion), associations or insurance
companies
but does not include general professional partnerships and a joint
venture
or consortium formed for the purpose of undertaking construction
projects
or engaging in petroleum, coal, geothermal, and other energy operations
pursuant to an operating or consortium agreement under a service
contract
with the government. General professional partnerships are partnerships
formed by persons for the sole purpose of exercising their common
profession,
no part of the income of which is derived from engaging in any trade or
business. The term "resident foreign" when applied to a corporation
means
a foreign corporation not otherwise organized under the laws of the
Philippines
but engaged in trade or business within the Philippines;
(j) "Countryside and
Barangay Business Enterprise" refers to any business entity,
association,
or cooperative registered under the provisions of Republic Act Numbered
Sixty-eight hundred ten (R.A. No. 6810), otherwise known as "Magna
Carta
For Countryside And Barangay Business Enterprises (Kalakalan 20)";
(k) "Dealer" means
one whose business is to buy and sell merchandise, goods, and chattels
as a merchant. He stands immediately between the producer or
manufacturer
and the consumer and depends for his profit not upon the labor he
bestows
upon his commodities but upon the skill and foresight with which he
watches
the market;
(l) "Fee" means a charge
fixed by law or ordinance for the regulation or inspection of a
business
or activity;
(m) "Franchise" is
a right or privilege, affected with public interest which is conferred
upon private persons or corporations, under such terms and conditions
as
the government and its political subdivisions may impose in the
interest
of public welfare, security, and safety;
(n) "Gross Sales or
Receipts" include the total amount of money or its equivalent
representing
the contract price, compensation or service fee, including the amount
charged
or materials supplied with the services and deposits or advance
payments
actually or constructively received during the taxable quarter for the
services performed or to be performed for another person excluding
discounts
if determinable at the time of sales, sales return, excise tax, and
value-added
tax (VAT);
(o) "Manufacturer"
includes every person who, by physical or chemical process, alters the
exterior texture or form or inner substance of any raw material or
manufactured
or partially manufactured product in such manner as to prepare it for
special
use or uses to which it could not have been put in its original
condition,
or who by any such process alters the quality of any such raw material
or manufactured or partially manufactured products so as to reduce it
to
marketable shape or prepare it for any of the use of industry, or who
by
any such process combines any such raw material or manufactured or
partially
manufactured products with other materials or products of the same or
of
different kinds and in such manner that the finished products of such
process
or manufacture can be put to a special use or uses to which such raw
material
or manufactured or partially manufactured products in their original
condition
could not have been put, and who in addition alters such raw material
or
manufactured or partially manufactured products, or combines the same
to
produce such finished products for the purpose of their sale or
distribution
to others and not for his own use or consumption;
(p) "Marginal Farmer
or Fisherman" refers to an individual engaged in subsistence farming or
fishing which shall be limited to the sale, barter or exchange of
agricultural
or marine products produced by himself and his immediate family;
(q) "Motor Vehicle"
means any vehicle propelled by any power other than muscular power
using
the public roads, but excluding road rollers, trolley cars,
street-sweepers,
sprinklers, lawn mowers, bulldozers, graders, fork-lifts, amphibian
trucks,
and cranes if not used on public roads, vehicles which run only on
rails
or tracks, and tractors, trailers, and traction engines of all kinds
used
exclusively for agricultural purposes;
(r) "Municipal Waters"
includes not only streams, lakes, and tidal waters within the
municipality,
not being the subject of private ownership and not comprised within the
national parks, public forest, timber lands, forest reserves or fishery
reserves, but also marine waters included between two lines drawn
perpendicularly
to the general coastline from points where the boundary lines of the
municipality
or city touch the sea at low tide and a third line parallel with the
general
coastline and fifteen (15) kilometers from it. Where two (2)
municipalities
are so situated on the opposite shores that there is less than fifteen
(15) kilometers of marine waters between them, the third line shall be
equally distant from opposite shores of the respective municipalities;
(s) "Operator" includes
the owner, manager, administrator, or any other person who operates or
is responsible for the operation of a business establishment or
undertaking;
(t) "Peddler" means
any person who, either for himself or on commission, travels from place
to place and sells his goods or offers to sell and deliver the same.
Whether
a peddler is a wholesale peddler or a retail peddler of a particular
commodity
shall be determined from the definition of wholesale dealer or retail
dealer
as provided in this Title;
(u) "Persons" means
every natural or juridical being, susceptible of rights and obligations
or of being the subject of legal relations;
(v) "Residents" refer
to natural persons who have their habitual residence in the province,
city,
or municipality where they exercise their civil rights and fulfill
their
civil obligations, and to juridical persons for which the law or any
other
provision creating or recognizing them fixes their residence in a
particular
province, city, or municipality. In the absence of such law, juridical
persons are residents of the province, city, or municipality where they
have their legal residence or principal place of business or where they
conduct their principal business or occupation;
(w) "Retail" means
a sale where the purchaser buys the commodity for his own consumption,
irrespective of the quantity of the commodity sold; (x) "Vessel"
includes
every type of boat, craft, or other artificial contrivance used, or
capable
of being used, as a means of transportation on water;
(y) "Wharfage" means
a fee assessed against the cargo of a vessel engaged in foreign or
domestic
trade based on quantity, weight, or measure received and/or discharged
by vessel; and cralaw:red
(z) "Wholesale" means
a sale where the purchaser buys or imports the commodities for resale
to
persons other than the end user regardless of the quantity of the
transaction.cralaw:red
SEC. 132. Local Taxing
Authority. - The power to impose a tax, fee, or charge or to
generate
revenue under this Code shall be exercised by the sanggunian of the
local
government unit concerned through an appropriate ordinance.cralaw:red
SEC. 133. Common Limitations
on the Taxing Powers of Local Government Units. - Unless otherwise
provided herein, the exercise of the taxing powers of provinces,
cities,
municipalities, and barangays shall not extend to the levy of the
following:chanrobles virtual law library
(a) Income tax, except
when levied on banks and other financial institutions;
(b) Documentary stamp tax;
(c) Taxes on estates,
inheritance, gifts, legacies and other acquisitions mortis causa,
except
as otherwise provided herein;
(d) Customs duties,
registration fees of vessel and wharfage on wharves, tonnage dues, and
all other kinds of customs fees, charges and dues except wharfage on
wharves
constructed and maintained by the local government unit concerned;
(e) Taxes, fees and
charges and other impositions upon goods carried into or out of, or
passing
through, the territorial jurisdictions of local government units in the
guise of charges for wharfage, tolls for bridges or otherwise, or other
taxes, fees or charges in any form whatsoever upon such goods or
merchandise;
(f) Taxes, fees or charges on agricultural and aquatic products when
sold
by marginal farmers or fishermen; (g) Taxes on business enterprises
certified
to by the Board of Investments as pioneer or non-pioneer for a period
of
six (6) and four (4) years, respectively from the date of registration;
(h) Excise taxes on
articles enumerated under the National Internal Revenue Code, as
amended,
and taxes, fees or charges on petroleum products;
(i) Percentage or value-added
tax (VAT) on sales, barters or exchanges or similar transactions on
goods
or services except as otherwise provided herein; (j) Taxes on the gross
receipts of transportation contractors and persons engaged in the
transportation
of passengers or freight by hire and common carriers by air, land or
water,
except as provided in this Code;
(k) Taxes on premiums
paid by way of reinsurance or retrocession;
(l) Taxes, fees or
charges for the registration of motor vehicles and for the issuance of
all kinds of licenses or permits for the driving thereof, except
tricycles;
(m) Taxes, fees, or
other charges on Philippine products actually exported, except as
otherwise
provided herein; (n) Taxes, fees, or charges, on Countryside and
Barangay
Business Enterprises and cooperatives duly registered under R.A. No.
6810
and Republic Act Numbered Sixty-nine hundred thirty-eight (R.A. No.
6938)
otherwise known as the "Cooperatives Code of the Philippines"
respectively; and cralaw:red
(o) Taxes, fees or
charges of any kind on the National Government , its agencies and
instrumentalities,
and local government units.
CHAPTER 2. SPECIFIC
PROVISIONS
ON THE TAXING AND OTHER REVENUE-RAISING POWERS OF LOCAL GOVERNMENT UNITSArticle One - ProvincesSEC. 134. Scope of
Taxing
Powers. - Except as otherwise provided in this Code, the province
may
levy only the taxes, fees, and charges as provided in this Article.
SEC. 135. Tax on Transfer
of Real Property Ownership. - (a) The province may impose a tax on
the sale, donation, barter, or on any other mode of transferring
ownership
or title of real property at the rate of not more than fifty percent
(50%)
of one percent (1%) of the total consideration involved in the
acquisition
of the property or of the fair market value in case the monetary
consideration
involved in the transfer is not substantial, whichever is higher. The
sale,
transfer or other disposition of real property pursuant to R.A. No.
6657
shall be exempt from this tax.cralaw:red
(b) For this purpose,
the Register of Deeds of the province concerned shall, before
registering
any deed, require the presentation of the evidence of payment of this
tax.
The provincial assessor shall likewise make the same requirement before
cancelling an old tax declaration and issuing a new one in place
thereof.
Notaries public shall furnish the provincial treasurer with a copy of
any
deed transferring ownership or title to any real property within thirty
(30) days from the date of notarization. It shall be the duty of the
seller,
donor, transferor, executor or administrator to pay the tax herein
imposed
within sixty (60) days from the date of the execution of the deed or
from
the date of the decedent's death.cralaw:red
SEC. 136. Tax on Business
of Printing and Publication. - The province may impose a tax on the
business of persons engaged in the printing and/or publication of
books,
cards, posters, leaflets, handbills, certificates, receipts, pamphlets,
and others of similar nature, at a rate not exceeding fifty percent
(50%)
of one percent (1%) of the gross annual receipts for the preceding
calendar
year. In the case of a newly started business, the tax shall not exceed
one-twentieth (1/20) of one percent (1%) of the capital investment. In
the succeeding calendar year, regardless of when the business started
to
operate, the tax shall be based on the gross receipts for the preceding
calendar year, or any fraction thereof, as provided herein. The
receipts
from the printing and/or publishing of books or other reading materials
prescribed by the Department of Education, Culture and Sports, as
school
texts or references shall be exempt from the tax herein imposed.cralaw:red
SEC. 137. Franchise Tax.
- Notwithstanding any exemption granted by any law or other special
law,
the province may impose a tax on businesses enjoying a franchise, at a
rate not exceeding fifty percent (50%) of one percent (1%) of the gross
annual receipts for the preceding calendar year based on the incoming
receipt,
or realized, within its territorial jurisdiction. In the case of a
newly
started business, the tax shall not exceed one-twentieth (1/20) of one
percent (1%) of the capital investment. In the succeeding calendar
year,
regardless of when the business started to operate, the tax shall be
based
on the gross receipts for the preceding calendar year, or any fraction
thereof, as provided herein.cralaw:red
SEC. 138. Tax on Sand,
Gravel and Other Quarry Resources. - The province may levy and
collect
not more than ten percent (10%) of fair market value in the locality
per
cubic meter of ordinary stones, sand, gravel, earth, and other quarry
resources,
as defined under the National Internal Revenue Code, as amended,
extracted
from public lands or from the beds of seas, lakes, rivers, streams,
creeks,
and other public waters within its territorial jurisdiction. The permit
to extract sand, gravel and other quarry resources shall be issued
exclusively
by the provincial governor, pursuant to the ordinance of the
sangguniang
panlalawigan. The proceeds of the tax on sand, gravel and other quarry
resources shall be distributed as follows:chanrobles virtual law library
(1) Province - Thirty
percent (30%);
(2) Component city
or municipality where the sand, gravel, and other quarry resources are
extracted - Thirty percent (30%); and cralaw:red
(3) barangay where the sand,
gravel, and other quarry resources are extracted - Forty percent (40%).cralaw:red
SEC. 139. Professional
Tax. - (a) The province may levy an annual professional tax on each
person engaged in the exercise or practice of his profession requiring
government examination at such amount and reasonable classification as
the sangguniang panlalawigan may determine but shall in no case exceed
Three hundred pesos (P=300.00).cralaw:red
(b) Every person legally
authorized to practice his profession shall pay the professional tax to
the province where he practices his profession or where he maintains
his
principal office in case he practices his profession in several places:
Provided, however, That such person who has paid the corresponding
professional
tax shall be entitled to practice his profession in any part of the
Philippines
without being subjected to any other national or local tax, license, or
fee for the practice of such profession.cralaw:red
(c) Any individual
or corporation employing a person subject to professional tax shall
require
payment by that person of the tax on his profession before employment
and
annually thereafter.cralaw:red
(d) The professional
tax shall be payable annually, on or before the thirty-first (31st) day
of January. Any person first beginning to practice a profession after
the
month of January must, however, pay the full tax before engaging
therein.
A line of profession does not become exempt even if conducted with some
other profession for which the tax has been paid. Professionals
exclusively
employed in the government shall be exempt from the payment of this tax.cralaw:red
(e) Any person subject
to the professional tax shall write in deeds, receipts, prescriptions,
reports, books of account, plans and designs, surveys and maps, as the
case may be, the number of the official receipt issued to him.cralaw:red
SEC. 140. Amusement Tax.
- (a) The province may levy an amusement tax to be collected from the
proprietors,
lessees, or operators of theaters, cinemas, concert halls, circuses,
boxing
stadia, and other places of amusement at a rate of not more than thirty
percent (30%) of the gross receipts from admission fees.cralaw:red
(b) In the case of
theaters or cinemas, the tax shall first be deducted and withheld by
their
proprietors, lessees, or operators and paid to the provincial treasurer
before the gross receipts are divided between said proprietors,
lessees,
or operators and the distributors of the cinematographic films.cralaw:red
(c) The holding of
operas, concerts, dramas, recitals, painting and art exhibitions,
flower
shows, musical programs, literary and oratorical presentations, except
pop, rock, or similar concerts shall be exempt from the payment of the
tax herein imposed.cralaw:red
(d) The sangguniang
panlalawigan may prescribe the time, manner, terms and conditions for
the
payment of tax. In case of fraud or failure to pay the tax, the
sangguniang
panlalawigan may impose such surcharges, interests and penalties as it
may deem appropriate.cralaw:red
(e) The proceeds from
the amusement tax shall be shared equally by the province and the
municipality
where such amusement places are located.cralaw:red
SEC. 141. Annual Fixed
Tax For Every Delivery Truck or Van of Manufacturers or Producers,
Wholesalers
of, Dealers, or Retailers in, Certain Products. - (a) The province
may levy an annual fixed tax for every truck, van or any vehicle used
by
manufacturers, producers, wholesalers, dealers or retailers in the
delivery
or distribution of distilled spirits, fermented liquors, soft drinks,
cigars
and cigarettes, and other products as may be determined by the
sangguniang
panlalawigan, to sales outlets, or consumers, whether directly or
indirectly,
within the province in an amount not exceeding Five hundred pesos
(P500.00).cralaw:red
(b) The manufacturers,
producers, wholesalers, dealers, and retailers referred to in the
immediately
foregoing paragraph shall be exempt from the tax on peddlers prescribed
elsewhere in this Code.
Article Two -
MunicipalitiesSEC. 142. Scope of
Taxing
Powers. - Except as otherwise provided in this Code, municipalities
may levy taxes, fees, and charges not otherwise levied by provinces.
SEC. 143. Tax on Business.
- The municipality may impose taxes on the following businesses:chanrobles virtual law library
(a) On manufacturers, assemblers,
repackers, processors, brewers, distillers, rectifiers, and compounders
of liquors, distilled spirits, and wines or manufacturers of any
article
of commerce of whatever kind or nature, in accordance with the
following
schedule: With gross sales or receipts for the Amount of Tax preceding
calendar year in the amount of:chanrobles virtual law library
Per Annum
- Less than 10,000.00
165.00
- P 10,000.00 or more
but less
than 15,000.00
- 15,000.00 or more but
less than
20,000.00
- 20,000.00 or more but
less than
30,000.00
- 30,000.00 or more but
less than
- 40,000.00 660.00
40,000.00 or
more but less than
- 50,000.00 825.00
50,000.00 or
more but less than 75,000.00 1,320.00
- 75,000.00 or more but
less than
100,000.00 1,650.00
- 100,000.00 or more but
less
than 150,000.00 2,200.00
- 150,000.00 or more but
less
than 200,000.00 2,750.00
- 200,000.00 or more but
less
than 300,000.00 3,850.00
- 300,000.00 or more but
less
than 500,000.00 5,500.00
- 500,000.00 or more but
less
than 750,000.00 8,000.00
- 750,000.00 or more but
less
than 1,000,000.00 10,000.00
- 1,000,000.00 or more
but less
than 2,000,000.00 13,750.00
- 2,000,000.00 or more
but less
than 3,000,000.00 16,500.00
- 3,000,000.00 or more
but less
than 4,000,000.00 19,800.00
- 4,000,000.00 or more
but less
than 5,000,000.00 23,100.00
- 5,000,000.00 or more
but less
than 6,500,000.00 24,375.00
- 6,500,000.00 or more
at a rate
not exceeding thirty-seven and a half percent (37 1/2%) of one percent
(1%)
(b) On wholesalers, distributors,
or dealers in any article of commerce of whatever kind or nature in
accordance
with the following schedule: With gross sales or receipts for the
Amount
of Tax preceding calendar year in the amount of:chanroblesvirtuallawlibrary
Per Annum
- Less than P1,000.00
18.00
- P 1,000.00 or more but
less
than P 2,000.00 33.00
- 2,000.00 or more but
less than
3,000.00 50.00
- 3,000.00 or more but
less than
4,000.00 72.00
- 4,000.00 or more but
less than
5,000.00 100.00
- 5,000.00 or more but
less than
6,000.00 121.00
- 6,000.00 or more but
less than
7,000.00 143.00
- 7,000.00 or more but
less than
8,000.00 165.00
- 8,000.00 or more but
less than
10,000.00 187.00
- 10,000.00 or more but
less than
15,000.00 220.00
- 15,000.00 or more but
less than
20,000.00 275.00
- 20,000.00 or more but
less than
30,000.00 330.00
- 30,000.00 or more but
less than
40,000.00 440.00
- 40,000.00 or more but
less than
50,000.00 660.00
- 50,000.00 or more but
less than
75,000.00 990.00
- 75,000.00 or more but
less than
100,000.00 1320.00
- 100,000.00 or more but
less
than 150,000.00 1870.00
- 150,000.00 or more but
less
than 200,000.00 2420.00
- 200,000.00 or more but
less
than 300,000.00 3300.00
- 300,000.00 or more but
less
than 500,000.00 4400.00
- 500,000.00 or more but
less
than 750,000.00 6600.00
- 750,000.00 or more but
less
than 1,000,000.00 8800.00
- 1,000,000.00 or more
but less
than 2,000,000.00 10000.00
- 2,000,000.00 or more
at a rate
not exceeding fifty percent (50%) of one percent (1%).
(c) On exporters, and on manufacturers,
millers, producers, wholesalers, distributors, dealers or retailers of
essential commodities enumerated hereunder at a rate not exceeding
one-half
(1/2) of the rates prescribed under subsections (a), (b) and (d) of
this
Section:chanroblesvirtuallawlibrary
(1) Rice and corn;
(2) Wheat or cassava
flour, meat, dairy products, locally manufactured, processed or
preserved
food, sugar, salt and other agricultural, marine, and fresh water
products,
whether in their original state or not;
(3) Cooking oil and
cooking gas;
(4) Laundry soap, detergents,
and medicine;
(5) Agricultural implements,
equipment and post- harvest facilities, fertilizers, pesticides,
insecticides,
herbicides and other farm inputs;
(6) Poultry feeds and
other animal feeds;
(7) School supplies; and cralaw:red
(8) Cement.cralaw:red
(d) On retailers, With
gross sales or receipts Rate of tax for the preceding calendar year of:chanroblesvirtuallawlibrary
per annum
- P400,000.00 or less 2%
- more than P400,000.00
1%
Provided, however, That barangays
shall have the exclusive power to levy taxes, as provided under Section
152 hereof, on gross sales or receipts of the preceding calendar year
of
Fifty thousand pesos (P=50,000.00) or less, in the case of cities, and
Thirty thousand pesos (P=30,000.00) or less, in the case of
municipalities.
(e) On contractors
and other independent contractors, in accordance with the following
schedule:chanrobles virtual law library
With gross receipts
for the preceding calendar year in the amount of:chanroblesvirtuallawlibrary
Amount of Tax Per
Annum
- Less than P= 5,000.00
27.50
- P 5,000.00 or more but
less
than P 10,000.00 61.60
- 10,000.00 or more but
less than
15,000.00 104.50
- 15,000.00 or more but
less than
20,000.00 165.00
- 20,000.00 or more but
less than
30,000.00 275.00
- 30,000.00 or more but
less than
40,000.00 385.00
- 40,000.00 or more but
less than
50,000.00 550.00
- 50,000.00 or more but
less than
75,000.00 880.00
- 75,000.00 or more but
less than
100,000.00 1320.00
- 100,000.00 or more but
less
than 150,000.00 1980.00
- 150,000.00 or more but
less
than 200,000.00 2640.00
- 200,000.00 or more but
less
than 250,000.00 3630.00
- 250,000.00 or more but
less
than 300,000.00 4620.00
- 300,000.00 or more but
less
than 400,000.00 6160.00
- 400,000.00 or more but
less
than 500,000.00 8250.00
- 500,000.00 or more but
less
than 750,000.00 9250.00
- 750,000.00 or more but
less
than 1,000,000.00 10250.00
- 1,000,000.00 or more
but less
than 2,000,000.00 11500.00
- 2,000,000.00 or more
at a rate
not exceeding fifty percent (50%) of one percent (1%)
(f) On banks and other financial
institutions, at a rate not exceeding fifty percent (50%) of one
percent
(1%) on the gross receipts of the preceding calendar year derived from
interest, commissions and discounts from lending activities, income
from
financial leasing, dividends, rentals on property and profit from
exchange
or sale of property, insurance premium.
(g) On peddlers engaged in
the sale of any merchandise or article of commerce, at a rate not
exceeding
Fifty pesos (P50.00) per peddler annually.cralaw:red
(h) On any business,
not otherwise specified in the preceding paragraphs, which the
sanggunian
concerned may deem proper to tax: Provided, That on any business
subject
to the excise, value-added or percentage tax under the National
Internal
Revenue Code, as amended, the rate of tax shall not exceed two percent
(2%) of gross sales or receipts of the preceding calendar year. The
sanggunian
concerned may prescribe a schedule of graduated tax rates but in no
case
to exceed the rates prescribed herein.cralaw:red
SEC. 144. Rates of Tax
within the Metropolitan Manila Area. - The municipalities within
the
Metropolitan Manila Area may levy taxes at rates which shall not exceed
by fifty percent (50%) the maximum rates prescribed in the preceding
Section.cralaw:red
SEC. 145. 4 Retirement
of Business. - A business subject to tax pursuant to the preceding
sections shall, upon termination thereof, submit a sworn statement of
its
gross sales or receipts for the current year. If the tax paid during
the
year be less than the tax due on said gross sales or receipts of the
current
year, the difference shall be paid before the business is considered
officially
retired.cralaw:red
SEC. 146. Payment of Business
Taxes. - (a) The taxes imposed under Section 143 shall be payable
for
every separate or distinct establishment or place where business
subject
to the tax is conducted and one line of business does not become exempt
by being conducted with some other business for which such tax has been
paid. The tax on a business must be paid by the person conducting the
same.cralaw:red
(b) In cases where
a person conducts or operates two (2) or more of the businesses
mentioned
in Section 143 of this Code which are subject to the same rate of tax,
the tax shall be computed on the combined total gross sales or receipts
of the said two (2) or more related businesses.cralaw:red
(c) In cases where
a person conducts or operates two (2) or more businesses mentioned in
Section
143 of this Code which are subject to different rates of tax, the gross
sales or receipts of each business shall be separately reported for the
purpose of computing the tax due from each business.cralaw:red
SEC. 147. Fees and Charges.
- The municipality may impose and collect such reasonable fees and
charges on business and occupation and, except as reserved to the
province
in Section 139 of this Code, on the practice of any profession or
calling,
commensurate with the cost of regulation, inspection and licensing
before
any person may engage in such business or occupation, or practice such
profession or calling.cralaw:red
SEC. 148. Fees for Sealing
and Licensing of Weights and Measures. - (a) The municipality may
levy
fees for the sealing and licensing of weights and measures at such
reasonable
rates as shall be prescribed by the sangguniang bayan.cralaw:red
(b) The sangguniang
bayan shall prescribe the necessary regulations for the use of such
weights
and measures, subject to such guidelines as shall be prescribed by the
Department of Science and Technology. The sanggunian concerned shall,
by
appropriate ordinance, penalize fraudulent practices and unlawful
possession
or use of instruments of weights and measures and prescribe the
criminal
penalty therefor in accordance with the provisions of this Code.
Provided,
however, That the sanggunian concerned may authorize the municipal
treasurer
to settle an offense not involving the commission of fraud before a
case
therefor is filed in court, upon payment of a compromise penalty of not
less than Two hundred pesos (P=200.00).cralaw:red
SEC. 149. Fishery Rentals,
Fees and Charges- (a) Municipalities shall have the exclusive
authority
to grant fishery privileges in the municipal waters and impose rentals,
fees or charges therefor in accordance with the provisions of this
Section.
(b) The sangguniang bayan may:chanrobles virtual law library
(1) Grant fishery privileges
to erect fish corrals, oyster, mussels or other aquatic beds or bangus
fry areas, within a definite zone of the municipal waters, as
determined
by it: Provided, however, That duly registered organizations and
cooperatives
of marginal fishermen shall have the preferential right to such fishery
privileges: Provided, further, That the sangguniang bayan may require a
public bidding in conformity with and pursuant to an ordinance for the
grant of such privileges: Provided, finally, That in the absence of
such
organizations and cooperatives or their failure to exercise their
preferential
right, other parties may participate in the public bidding in
conformity
with the above cited procedure.cralaw:red
(2) Grant the privilege
to gather, take or catch bangus fry, prawn fry or kawag-kawag or fry of
other species and fish from the municipal waters by nets, traps or
other
fishing gears to marginal fishermen free of any rental, fee, charge or
any other imposition whatsoever.cralaw:red
(3) Issue licenses
for the operation of fishing vessels of three (3) tons or less for
which
purpose the sangguniang bayan shall promulgate rules and regulations
regarding
the issuances of such licenses to qualified applicants under existing
laws.cralaw:red
Provided, however,
That the sanggunian concerned shall, by appropriate ordinance, penalize
the use of explosives, noxious or poisonous substances, electricity,
muro-ami,
and other deleterious methods of fishing and prescribe a criminal
penalty
therefor in accordance with the provisions of this Code: Provided,
finally,
That the sanggunian concerned shall have the authority to prosecute any
violation of the provisions of applicable fishery laws.cralaw:red
SEC. 150. Situs of the
Tax. - (a) For purposes of collection of the taxes under Section
143
of this Code, manufacturers, assemblers, repackers, brewers,
distillers,
rectifiers and compounders of liquor, distilled spirits and wines,
millers,
producers, exporters, wholesalers, distributors, dealers, contractors,
banks and other financial institutions, and other businesses,
maintaining
or operating branch or sales outlet elsewhere shall record the sale in
the branch or sales outlet making the sale or transaction, and the tax
thereon shall accrue and shall be paid to the municipality where such
branch
or sales outlet is located. In cases where there is no such branch or
sales
outlet in the city or municipality where the sale or transaction is
made,
the sale shall be duly recorded in the principal office and the taxes
due
shall accrue and shall be paid to such city or municipality.cralaw:red
(b) The following sales
allocation shall apply to manufacturers, assemblers, contractors,
producers,
and exporters with factories, project offices, plants, and plantations
in the pursuit of their business:chanrobles virtual law library
(1) Thirty percent
(30%) of all sales recorded in the principal office shall be taxable by
the city or municipality where the principal office is located; and cralaw:red
(2) Seventy percent
(70%) of all sales recorded in the principal office shall be taxable by
the city or city or municipality where the factory is located; and cralaw:red
(2) Forty percent (40%)
to the city ormunicipality where the plantation is located.cralaw:red
(d) In cases where
a manufacturer, assembler, producer, exporter or contractor has two (2)
or more factories, project offices, plants, or plantations located in
different
localities, the seventy percent (70%) sales allocation mentioned in
subparagraph
(b) of subsection (2) above shall be prorated among the localities
where
the factories, project offices, plants, and plantations are located in
proportion to their respective volumes of production during the period
for which the tax is due.cralaw:red
(e) The foregoing sales
allocation shall be applied irrespective of whether or not sales are
made
in the locality where the factory, project office, plant, or plan is
located.
Article Three -
CitiesSEC. 151. Scope of
Taxing
Powers. - Except as otherwise provided in this Code, the city, may
levy the taxes, fees, and charges which the province or municipality
may
impose: Provided, however, That the taxes, fees and charges levied and
collected by highly urbanized and independent component cities shall
accrue
to them and distributed in accordance with the provisions of this Code.
The rates of taxes that the city may levy may exceed the maximum rates
allowed for the province or municipality by not more than fifty percent
(50%) except the rates of professional and amusement taxes.Article Four -
BarangaysSEC. 152. Scope of
Taxing
Powers. - The barangays may levy taxes, fees, and charges, as
provided
in this Article, which shall exclusively accrue to them:chanroblesvirtuallawlibrary
(a) Taxes - On stores
or retailers with fixed business establishments with gross sales or
receipts
of the preceding calendar year of Fifty thousand pesos (P=50,000.00) or
less, in the case of cities and Thirty thousand pesos (P=30,000.00) or
less, in the case of municipalities, at a rate not exceeding one
percent
(1%) on such gross sales or receipts.cralaw:red
(b) Service Fees or
Charges - barangays may collect reasonable fees or charges for services
rendered in connection with the regulation or the use of barangay-owned
properties or service facilities such as palay, copra, or tobacco
dryers.cralaw:red
(c) Barangay Clearance
- No city or municipality may issue any license or permit for any
business
or activity unless a clearance is first obtained from the barangay
where
such business or activity is located or conducted. For such clearance,
the sangguniang barangay may impose a reasonable fee. The application
for
clearance shall be acted upon within seven (7) working days from the
filing
thereof. In the event that the clearance is not issued within the said
period, the city or municipality may issue the said license or permit.cralaw:red
(d) Other Fees and
Charges - The barangay may levy reasonable fees and charges:chanrobles virtual law library
(1) On commercial breeding
of fighting cocks, cockfights and cockpits;
(2) On places of recreation
which charge admission fees; and cralaw:red
(3) On billboards,
signboards, neon signs, and outdoor advertisements.
Article Five - Common
Revenue-Raising
PowersSEC. 153. Service Fees
and
Charges. - Local government units may impose and collect such
reasonable
fees and charges for services rendered.
SEC. 154. Public Utility
Charges. - Local government units may fix the rates for the
operation
of public utilities owned, operated and maintained by them within their
jurisdiction.cralaw:red
SEC. 155. Toll Fees or
Charges. - The sanggunian concerned may prescribe the terms and
conditions
and fix the rates for the imposition of toll fees or charges for the
use
of any public road, pier or wharf, waterway, bridge, ferry or
telecommunication
system funded and constructed by the local government unit concerned:
Provided,
That no such toll fees or charges shall be collected from officers and
enlisted men of the Armed Forces of the Philippines and members of the
Philippine National Police on mission, post office personnel delivering
mail, physically-handicapped, and disabled citizens who are sixty-five
(65) years or older. When public safety and welfare so requires, the
sanggunian
concerned may discontinue the collection of the tolls, and thereafter
the
said facility shall be free and open for public use.
Article Six -
Community TaxSEC. 156. Community Tax.
- Cities or municipalities may levy a community tax in accordance with
the provisions of this Article.
SEC. 157. Individuals
Liable to Community Tax. - Every inhabitant of the Philippines
eighteen
(18) years of age or over who has been regularly employed on a wage or
salary basis for at least thirty (30) consecutive working days during
any
calendar year, or who is engaged in business or occupation, or who owns
real property with an aggregate assessed value of One thousand pesos
(P=1,000.00)
or more, or who is required by law to file an income tax return shall
pay
an annual community tax of Five pesos (P=5.00) and an annual additional
tax of One peso (P=1.00) for every One thousand pesos (P=1,000.00) of
income
regardless of whether from business, exercise of profession or from
property
which in no case shall exceed Five thousand pesos (P=5,000.00). In the
case of husband and wife, the additional tax herein imposed shall be
based
upon the total property owned by them and the total gross receipts or
earnings
derived by them.cralaw:red
SEC. 158. Juridical Persons
Liable to Community Tax. - Every corporation no matter how created
or organized, whether domestic or resident foreign, engaged in or doing
business in the Philippines shall pay an annual community tax of Five
hundred
pesos (P=500.00) and an annual additional tax, which, in no case, shall
exceed Ten thousand pesos (P=10,000.00) in accordance with the
following
schedule:chanrobles virtual law library
(1) For every Five
thousand pesos (P=5,000.00) worth of real property in the Philippines
owned
by it during the preceding year based on the valuation used for the
payment
of the real property tax under existing laws, found in the assessment
rolls
of the city or municipality where the real property is situated - Two
pesos
(P=2.00); and cralaw:red
(2) For every Five
thousand pesos (P=5,000.00) of gross receipts or earnings derived by it
from its business in the Philippines during the preceding year - Two
pesos
(P=2.00). The dividends received by a corporation from another
corporation
however shall, for the purpose of the additional tax, be considered as
part of the gross receipts or earnings of said corporation.cralaw:red
SEC. 159. Exemptions.
- The following are exempt from the community tax:chanrobles virtual law library
(1) Diplomatic and
consular representatives; and cralaw:red
(2) Transient visitors
when their stay in the Philippines does not exceed three (3) months.cralaw:red
SEC. 160. Place of Payment.
- The community tax shall be paid in the place of residence of the
individual,
or in the place where the principal office of the juridical entity is
located.cralaw:red
SEC. 161. Time for Payment;
Penalties for Delinquency. - (a) The community tax shall accrue on
the first (1st) day of January of each year which shall be paid not
later
than the last day of February of each year. If a person reaches the age
of eighteen (18) years or otherwise loses the benefit of exemption on
or
before the last day of June, he shall be liable for the community tax
on
the day he reaches such age or upon the day the exemption ends.
However,
if a person reaches the age of eighteen (18) years or loses the benefit
of exemption on or before the last day of March, he shall have twenty
(20)
days to pay the community tax without becoming delinquent. Persons who
come to reside in the Philippines or reach the age of eighteen (18)
years
on or after the first (1st) day of July of any year, or who cease to
belong
to an exempt class on or after the same date, shall not be subject to
the
community tax for that year.cralaw:red
(b) Corporations established
and organized on or before the last day of June shall be liable for the
community tax for that year. But corporations established and organized
on or before the last day of March shall have twenty (20) days within
which
to pay the community tax without becoming delinquent. Corporations
established
and organized on or after the first day of July shall not be subject to
the community tax for that year. If the tax is not paid within the time
prescribed above, there shall be added to the unpaid amount an interest
of twenty-four percent (24%) per annum from the due date until it is
paid.cralaw:red
SEC. 162. Community Tax
Certificate. - A community tax certificate shall be issued to every
person or corporation upon payment of the community tax. A community
tax
certificate may also be issued to any person or corporation not subject
to the community tax upon payment of One peso (P=1.00).cralaw:red
SEC. 163. Presentation
of Community Tax Certificate On Certain Occasions. - (a) When an
individual
subject to the community tax acknowledges any document before a notary
public, takes the oath of office upon election or appointment to any
position
in the government service; receives any license, certificate, or permit
from any public authority; pays any tax or fee; receives any money from
any public fund; transacts other official business; or receives any
salary
or wage from any person or corporation, it shall be the duty of any
person,
officer, or corporation with whom such transaction is made or business
done or from whom any salary or wage is received to require such
individual
to exhibit the community tax certificate. The presentation of community
tax certificate shall not be required in connection with the
registration
of a voter.cralaw:red
(b) When, through its
authorized officers, any corporation subject to the community tax
receives
any license, certificate, or permit from any public authority, pays any
tax or fee, receives money from public funds, or transacts other
official
business, it shall be the duty of the public official with whom such
transaction
is made or business done, to require such corporation to exhibit the
community
tax certificate.cralaw:red
(c) The community tax
certificate required in the two preceding paragraphs shall be the one
issued
for the current year, except for the period from January until the
fifteenth
(15th) of April each year, in which case, the certificate issued for
the
preceding year shall suffice.cralaw:red
SEC. 164. Printing of
Community Tax Certificates and Distribution of Proceeds. - (a) The
Bureau of Internal Revenue shall cause the printing of community tax
certificates
and distribute the same to the cities and municipalities through the
city
and municipal treasurers in accordance with prescribed regulations. The
proceeds of the tax shall accrue to the general funds of the cities,
municipalities
and barangays except a portion thereof which shall accrue to the
general
fund of the national government to cover the actual cost of printing
and
distribution of the forms and other related expenses. The city or
municipal
treasurer concerned shall remit to the national treasurer the said
share
of the national government in the proceeds of the tax within ten (10)
days
after the end of each quarter.cralaw:red
(b) The city or municipal
treasurer shall deputize the barangay treasurer to collect the
community
tax in their respective jurisdictions: Provided, however, That said
barangay
treasurer shall be bonded in accordance with existing laws.cralaw:red
(c) The proceeds of
the community tax actually and directly collected by the city or
municipal
treasurer shall accrue entirely to the general fund of the city or
municipality
concerned. However, proceeds of the community tax collected through the
barangay treasurers shall be apportioned as follows:chanrobles virtual law library
(1) Fifty percent (50%)
shall accrue to the general fund of the city or municipality concerned;
and (2) Fifty percent (50%) shall accrue to the barangay where the tax
is collected.
CHAPTER 3 - COLLECTION
OF
TAXESSEC. 165. Tax Period
and
Manner of Payment. - Unless otherwise provided in this Code, the
tax
period of all local taxes, fees and charges shall be the calendar year.
Such taxes, fees and charges may be paid in quarterly installments.
SEC. 166. Accrual of Tax.
- Unless otherwise provided in this Code, all local taxes, fees, and
charges
shall accrue on the first (1st) day of January of each year. However,
new
taxes, fees or charges, or changes in the rates thereof, shall accrue
on
the first (1st) day of the quarter next following the effectivity of
the
ordinance imposing such new levies or rates.cralaw:red
SEC. 167. Time of Payment.
- Unless otherwise provided in this Code, all local taxes, fees, and
charges
shall be paid within the first twenty (20) days of January or of each
subsequent
quarter, as the case may be. The sanggunian concerned may, for a
justifiable
reason or cause, extend the time for payment of such taxes, fees, or
charges
without surcharges or penalties, but only for a period not exceeding
six
(6) months
SEC. 168. Surcharges and
Penalties on Unpaid Taxes, Fees, or Charges. - The sanggunian may
impose
a surcharge not exceeding twenty-five percent (25%) of the amount of
taxes,
fees or charges not paid on time and an interest at the rate not
exceeding
two percent (2%) per month of the unpaid taxes, fees or charges
including
surcharges, until such amount is fully paid but in no case shall the
total
interest on the unpaid amount or portion thereof exceed thirty-six (36)
months.cralaw:red
SEC. 169. Interests on
Other Unpaid Revenues. - Where the amount of any other revenue due
a local government unit, except voluntary contributions or donations,
is
not paid on the date fixed in the ordinance, or in the contract,
expressed
or implied, or upon the occurrence of the event which has given rise to
its collection, there shall be collected as part of that amount an
interest
thereon at the rate not exceeding two percent (2%) per month from the
date
it is due until it is paid, but in no case shall the total interest on
the unpaid amount or a portion thereof exceed thirty-six (36) months.cralaw:red
SEC. 170. Collection of
Local Revenues by Treasurer. - All local taxes, fees, and charges
shall
be collected by the provincial, city, municipal, or barangay treasurer,
or their duly authorized deputies. The provincial, city or municipal
treasurer
may designate the barangay treasurer as his deputy to collect local
taxes,
fees, or charges. In case a bond is required for the purpose, the
provincial,
city or municipal government shall pay the premiums thereon in addition
to the premiums of bond that may be required under this Code.cralaw:red
SEC. 171. Examination
of Books of Accounts and Pertinent Records of Businessmen by Local
Treasurer.
- The provincial, city, municipal or barangay treasurer may, by
himself
or through any of his deputies duly authorized in writing, examine the
books, accounts, and other pertinent records of any person,
partnership,
corporation, or association subject to local taxes, fees and charges in
order to ascertain, assess, and collect the correct amount of the tax,
fee, or charge. Such examination shall be made during regular business
hours, only once for every tax period, and shall be certified to by the
examining official. Such certificate shall be made of record in the
books
of accounts of the taxpayer examined. In case the examination herein
authorized
is made by a duly authorized deputy of the local treasurer, the written
authority of the deputy concerned shall specifically state the name,
address,
and business of the taxpayer whose books, accounts, and pertinent
records
are to be examined, the date and place of such examination, and the
procedure
to be followed in conducting the same. For this purpose, the records of
the revenue district office of the Bureau of Internal Revenue shall be
made available to the local treasurer, his deputy or duly authorized
representative.
CHAPTER 4 - CIVIL
REMEDIES FOR
COLLECTION OF REVENUESSEC. 172. Application
of
Chapter. - The provisions of this Chapter and the remedies provided
herein may be availed of for the collection of any elinquent local tax,
fee, charge, or other revenue.
SEC. 173. Local Government's
Lien. - Local taxes, fees, charges and other revenues constitute a
lien, superior to all liens, charges or encumbrances in favor of any
person,
enforceable by appropriate administrative or judicial action, not only
upon any property or rights therein which may be subject to the lien
but
also upon property used in business, occupation, practice of profession
or calling, or exercise of privilege with respect to which the lien is
imposed. The lien may only be extinguished upon full payment of the
elinquent
local taxes fees and charges including related surcharges and interest.cralaw:red
SEC. 174. Civil Remedies.
- The civil remedies for the collection of local taxes, fees, or
charges,
and related surcharges and interest resulting from delinquency shall be:chanrobles virtual law library
(a) By administrative
action thru distraint of goods, chattels, or effects, and other
personal
property of whatever character, including stocks and other securities,
debts, credits, bank accounts, and interest in and rights to personal
property,
and by levy upon real property and interest in or rights to real
property; and cralaw:red
(b) By judicial action.
Either of these remedies or all may be pursued concurrently or
simultaneously
at the discretion of the local government unit concerned.cralaw:red
SEC. 175. Distraint of
Personal Property. - The remedy by distraint shall proceed as
follows:chanrobles virtual law library
(a) Seizure - Upon
failure of the person owing any local tax, fee, or charge to pay the
same
at the time required, the local treasurer or his deputy may, upon
written
notice, seize or confiscate any personal property belonging to that
person
or any personal property subject to the lien in sufficient quantity to
satisfy the tax, fee, or charge in question, together with any
increment
thereto incident to delinquency and the expenses of seizure. In such
case,
the local treasurer or his deputy shall issue a duly authenticated
certificate
based upon the records of his office showing the fact of delinquencycy
and the amounts of the tax, fee, or charge and penalty due. Such
certificate
shall serve as sufficient warrant for the distraint of personal
property
aforementioned, subject to the taxpayer's right to claim exemption
under
the provisions of existing laws. Distrained personal property shall be
sold at public auction in the manner herein provided for.cralaw:red
(b) Accounting of distrained
goods - The officer executing the distraint shall make or cause to be
made
an account of the goods, chattels or effects distrained, a copy of
which
signed by himself shall be left either with the owner or person from
whose
possession the goods, chattels or effects are taken, or at the dwelling
or place of business of that person and with someone of suitable age
and
discretion, to which list shall be added a statement of the sum
demanded
and a note of the time and place of sale.cralaw:red
(c) Publication - The
officer shall forthwith cause a notification to be exhibited in not
less
than three (3) public and conspicuous places in the territory of the
local
government unit where the distraint is made, specifying the time and
place
of sale, and the articles distrained. The time of sale shall not be
less
than twenty (20) days after notice to the owner or possessor of the
property
as above specified and the publication or posting of the notice. One
place
for the posting of the notice shall be at the office of the chief
executive
of the local government unit in which the property is distrained.cralaw:red
(d) Release of distrained
property upon payment prior to sale - If at any time prior to the
consummation
of the sale, all the proper charges are paid to the officer conducting
the sale, the goods or effects distrained shall be restored to the
owner.cralaw:red
(e) Procedure of sale
- At the time and place fixed in the notice, the officer conducting the
sale shall sell the goods or effects so distrained at public auction to
the highest bidder for cash. Within five (5) days after the sale, the
local
treasurer shall make a report of the proceedings in writing to the
local
chief executive concerned. Should the property distrained be not
disposed
of within one hundred and twenty (120) days from the date of distraint,
the same shall be considered as sold to the local government unit
concerned
for the amount of the assessment made thereon by the Committee on
Appraisal
and to the extent of the same amount, the tax delinquencies shall be
cancelled.
Said Committee on Appraisal shall be composed of the city or municipal
treasurer as chairman, with a representative of the Commission on Audit
and the city or municipal assessor as members.cralaw:red
(f) Disposition of
proceeds - The proceeds of the sale shall be applied to satisfy the
tax,
including the surcharges, interest, and other penalties incident to
delinquency,
and the expenses of the distraint and sale. The balance over and above
what is required to pay the entire claim shall be returned to the owner
of the property sold. The expenses chargeable upon the seizure and sale
shall embrace only the actual expenses of seizure and preservation of
the
property pending the sale, and no charge shall be imposed for the
services
of the local officer or his deputy. Where the proceeds of the sale are
insufficient to satisfy the claim, other property may, in like manner,
be distrained until the full amount due, including all
SEC. 176. Levy on Real
Property - After the expiration of the time required to pay the
delinquent
tax, fee, or charge, real property may be levied on before,
simultaneously,
or after the distraint of personal property belonging to the delinquent
taxpayer. To this end, the provincial, city or municipal treasurer, as
the case may be, shall prepare a duly authenticated certificate showing
the name of the taxpayer and the amount of the tax, fee, or charge, and
penalty due from him. Said certificate shall operate with the force of
a legal execution throughout the Philippines. Levy shall be effected by
writing upon said certificate the description of the property upon
which
levy is made. At the same time, written notice of the levy shall be
mailed
to or served upon the assessor and the Registrar of Deeds of the
province
or city where the property is located who shall annotate the levy on
the
tax declaration and certificate of title of the property, respectively,
and the delinquent taxpayer or, if he be absent from the Philippines,
to
his agent or the manager of the business in respect to which the
liability
arose, or if there be none, to the occupant of the property in
question.
In case the levy on real property is not issued before or
simultaneously
with the warrant of distraint on personal property, and the personal
property
of the taxpayer is not sufficient to satisfy his delinquency, the
provincial,
city or municipal treasurer, as the case may be, shall within thirty
(30)
days after execution of the distraint, proceed with the levy on the
taxpayer's
real property. A report on any levy shall, within ten (10) days after
receipt
of the warrant, be submitted by the levying officer to the sanggunian
concerned.cralaw:red
SEC. 177. Penalty for
Failure to Issue and Execute Warrant. - Without prejudice to
criminal
prosecution under the Revised Penal Code and other applicable laws, any
local treasurer who fails to issue or execute the warrant of distraint
or levy after the expiration of the time prescribed, or who is found
guilty
of abusing the exercise thereof by competent authority shall be
automatically
dismissed from the service after due notice and hearing.cralaw:red
SEC. 178. Advertisement
and Sale. - Within thirty (30) days after levy, the local treasurer
shall proceed to publicly advertise for sale or auction the property or
a usable portion thereof as may be necessary to satisfy the claim and
cost
of sale; and such advertisement shall cover a period of at least thirty
(30) days. It shall be effected by posting a notice at the main
entrance
of the municipal building or city hall, and in a public and conspicuous
place in the barangay where the real property is located, and by
publication
once a week for three (3) weeks in a newspaper of general circulation
in
the province, city or municipality where the property is located. The
advertisement
shall contain the amount of taxes, fees or charges, and penalties due
thereon,
and the time and place of sale, the name of the taxpayer against whom
the
taxes, fees, or charges are levied, and a short description of the
property
to be sold. At any time before the date fixed for the sale, the
taxpayer
may stay the proceedings by paying the taxes, fees, charges, penalties
and interests. If he fails to do so, the sale shall proceed and shall
be
held either at the main entrance of the provincial, city or municipal
building,
or on the property to be sold, or at any other place as determined by
the
local treasurer conducting the sale and specified in the notice of
sale.
Within thirty (30) days after the sale, the local treasurer or his
deputy
shall make a report of the sale to the sanggunian concerned, and which
shall form part of his records. After consultation with the sanggunian,
the local treasurer shall make and deliver to the purchaser a
certificate
of sale, showing the proceedings of the sale, describing the property
sold,
stating the name of the purchaser and setting out the exact amount of
all
taxes, fees, charges, and related surcharges, interests, or penalties:
Provided, however, That any excess in the proceeds of the sale over the
claim and cost of sales shall be turned over to the owner of the
property.
The local treasurer may, by ordinance duly approved, advance an amount
sufficient to defray the costs of collection by means of the remedies
provided
for in this Title, including the preservation or transportation in case
of personal property, and the advertisement and subsequent sale, in
cases
of personal and real property including improvements thereon.cralaw:red
SEC. 179. Redemption of
Property Sold. - Within one (1) year from the date of sale, the
delinquent
taxpayer or his representative shall have the right to redeem the
property
upon payment to the local treasurer of the total amount of taxes, fees,
or charges, and related surcharges, interests or penalties from the
date
of delinquency to the date of sale, plus interest of not more than two
percent (2%) per month on the purchase price from the date of purchase
to the date of redemption. Such payment shall invalidate the
certificate
of sale issued to the purchaser and the owner shall be entitled to a
certificate
of redemption from the provincial, city or municipal treasurer or his
deputy.
The provincial, city or municipal treasurer or his deputy, upon
surrender
by the purchaser of the certificate of sale previously issued to him,
shall
forthwith return to the latter the entire purchase price paid by him
plus
the interest of not more than two percent (2%) per month herein
provided
for, the portion of the cost of sale and other legitimate expenses
incurred
by him, and said property thereafter shall be free from the lien of
such
taxes, fees, or charges, related surcharges, interests, and penalties.
The owner shall not, however, be deprived of the possession of said
property
and shall be entitled to the rentals and other income thereof until the
expiration of the time allowed for its redemption.
SEC. 180. Final Deed
to Purchaser. - In case the taxpayer fails to redeem the property
as
provided herein, the local treasurer shall execute a deed conveying to
the purchaser so much of the property as has been sold, free from liens
of any taxes, fees, charges, related surcharges, interests, and
penalties.
The deed shall succintly recite all the proceedings upon which the
validity
of the sale depends.cralaw:red
SEC. 181. Purchase of
Property By the Local Government Units for Want of Bidder. - In
case
there is no bidder for the real property advertised for sale as
provided
herein, or if the highest bid is for an amount insufficient to pay the
taxes, fees, or charges, related surcharges, interests, penalties and
costs,
the local treasurer conducting the sale shall purchase the property in
behalf of the local government unit concerned to satisfy the claim and
within two (2) days thereafter shall make a report of his proceedings
which
shall be reflected upon the records of his office. It shall be the duty
of the Registrar of Deeds concerned upon registration with his office
of
any such declaration of forfeiture to transfer the title of the
forfeited
property to the local government unit concerned without the necessity
of
an order from a competent court. Within one (1) year from the date of
such
forfeiture, the taxpayer or any of his representative, may redeem the
property
by paying to the local treasurer the full amount of the taxes, fees,
charges,
and related surcharges, interests, or penalties, and the costs of sale.
If the property is not redeemed as provided herein, the ownership
thereof
shall be fully vested on the local government unit concerned.cralaw:red
SEC. 182. Resale of Real
Estate Taken for Taxes, Fees, or Charges. - The sanggunian
concerned
may, by ordinance duly approved, and upon notice of not less than
twenty
(20) days, sell and dispose of the real property acquired under the
preceding
section at public auction. The proceeds of the sale shall accrue to the
general fund
SEC. 183. Collection
of Delinquent Taxes, Fees, Charges or other Revenues through Judicial
Action.
- The local government unit concerned may enforce the collection of
delinquent
taxes, fees, charges or other revenues by civil action in any court of
competent jurisdiction. The civil action shall be filed by the local
treasurer
within the period prescribed in Section 194 of this Code.cralaw:red
SEC. 184. Further Distraint
or Levy. - The remedies by distraint and levy may be repeated if
necessary
until the full amount due, including all expenses, is collected.cralaw:red
SEC. 185. Personal Property
Exempt from Distraint or Levy. - The following property shall be
exempt
from distraint and the levy, attachment or execution thereof for
delinquency
in the payment of any local tax, fee or charge, including the related
surcharge
and interest:chanrobles virtual law library
(a) Tools and the implements
necessarily used by the delinquent taxpayer in his trade or employment;
(b) One (1) horse,
cow, carabao, or other beast of burden, such as the delinquent taxpayer
may select, and necessarily used by him in his ordinary occupation;
(c) His necessary clothing,
and that of all his family;
(d) Household furniture
and utensils necessary for housekeeping and used for that purpose by
the
delinquent taxpayer, such as he may select, of a value not exceeding
Ten
thousand pesos (P=10,000.00);
(e) Provisions, including
crops, actually provided for individual or family use sufficient for
four
(4) months;
(f) The professional
libraries of doctors, engineers, lawyers and judges;
(g) One fishing boat
and net, not exceeding the total value of Ten thousand pesos
(P=10,000.00),
by the lawful use of which a fisherman earns his livelihood; and cralaw:red
(h) Any material or
article forming part of a house or improvement of any real property.
CHAPTER 5 -
MISCELLANEOUS PROVISIONSSEC. 186. Power To
Levy Other
Taxes, Fees or Charges. - Local government units may exercise the
power
to levy taxes, fees or charges on any base or subject not otherwise
specifically
enumerated herein or taxed under the provisions of the National
Internal
Revenue Code, as amended, or other applicable laws: Provided, That the
taxes, fees, or charges shall not be unjust, excessive, oppressive,
confiscatory
or contrary to declared national policy: Provided, further, That the
ordinance
levying such taxes, fees or charges shall not be enacted without any
prior
public hearing conducted for the purpose.
SEC. 187. Procedure for
Approval and Effectivity of Tax ordinances and Revenue Measures;
Mandatory
Public Hearings. - The procedure for approval of local tax
ordinances
and revenue measures shall be in accordance with the provisions of this
Code: Provided, That public hearings shall be conducted for the purpose
prior to the enactment thereof: Provided, further, That any question on
the constitutionality or legality of tax ordinances or revenue measures
may be raised on appeal within thirty (30) days from the effectivity
thereof
to the Secretary of Justice who shall render a decision within sixty
(60)
days from the date of receipt of the appeal: Provided, however, That
such
appeal shall not have the effect of suspending the effectivity of the
ordinance
and the accrual and payment of the tax, fee, or charge levied therein:
Provided, finally, That within thirty (30) days after receipt of the
decision
or the lapse of the sixty-day period without the Secretary of Justice
acting
upon the appeal, the aggrieved party may file appropriate proceedings
with
a court of competent jurisdiction.cralaw:red
SEC. 188. Publication
of Tax ordinances and Revenue Measures. - Within ten (10) days
after
their approval, certified true copies of all provincial, city, and
municipal
tax ordinances or revenue measures shall be published in full for three
(3) consecutive days in a newspaper of local circulation: Provided,
however,
That in provinces, cities and municipalities where there are no
newspapers
of local circulation, the same may be posted in at least two (2)
conspicuous
and publicly accessible places.cralaw:red
SEC. 189. Furnishing of
Copies of Tax ordinances and Revenue Measures. - Copies of all
provincial,
city, and municipal and barangay tax ordinances and revenue measures
shall
be furnished the respective local treasurers for public dissemination.
SEC. 190. Attempt to
Enforce Void or Suspended Tax ordinances and revenue measures. -
The
enforcement of any tax ordinance or revenue measure after due notice of
the disapproval or suspension thereof shall be sufficient ground for
administrative
disciplinary action against the local officials and employees
responsible
therefor.cralaw:red
SEC. 191. Authority of
Local Government Units to Adjust Rates of Tax ordinances. - Local
government
units shall have the authority to adjust the tax rates as prescribed
herein
not oftener than once every five (5) years, but in no case shall such
adjustment
exceed ten percent (10%) of the rates fixed under this Code.cralaw:red
SEC. 192. Authority to
Grant Tax Exemption Privileges. - Local government units may,
through
ordinances duly approved, grant tax exemptions, incentives or reliefs
under
such terms and conditions as they may deem necessary.cralaw:red
SEC. 193. Withdrawal of
Tax Exemption Privileges. - Unless otherwise provided in this Code,
tax exemptions or incentives granted to, or presently enjoyed by all
persons,
whether natural or juridical, including government-owned or -controlled
corporations, except local water districts, cooperatives duly
registered
under R.A. No. 6938, non-stock and non-profit hospitals and educational
institutions, are hereby withdrawn upon the effectivity of this Code.
CHAPTER 6 - TAXPAYER'S
REMEDIESSEC. 194. Periods of
Assessment
and Collection. - (a) Local taxes, fees, or charges shall be
assessed
within five (5) years from the date they became due. No action for the
collection of such taxes, fees, or charges, whether administrative or
judicial,
shall be instituted after the expiration of such period: Provided,
That,
taxes, fees or charges which have accrued before the effectivity of
this
Code may be assessed within a period of three (3) years from the date
they
became due.
(b) In case of fraud
or intent to evade the payment of taxes, fees, or charges, the same may
be assessed within ten (10) years from discovery of the fraud or intent
to evade payment.cralaw:red
(c) Local taxes, fees,
or charges may be collected within five (5) years from the date of
assessment
by administrative or judicial action. No such action shall be
instituted
after the expiration of said period: Provided, however, That, taxes,
fees
or charges assessed before the effectivity of this Code may be
collected
within a period of three (3) years from the date of assessment.cralaw:red
(d) The running of
the periods of prescription provided in the preceding paragraphs shall
be suspended for the time during which:chanrobles virtual law library
(1) The treasurer is
legally prevented from making the assessment of collection;
(2) The taxpayer requests
for a reinvestigation and executes a waiver in writing before
expiration
of the period within which to assess or collect; and cralaw:red
(3) The taxpayer is
out of the country or otherwise cannot be located.cralaw:red
SEC. 195. Protest of Assessment.
- When the local treasurer or his duly authorized representative finds
that correct taxes, fees, or charges have not been paid, he shall issue
a notice of assessment stating the nature of the tax, fee or charge,
the
amount of deficiency, the surcharges, interests and penalties. Within
sixty
(60) days from the receipt of the notice of assessment, the taxpayer
may
file a written protest with the local treasurer contesting the
assessment;
otherwise, the assessment shall become final and executory. The local
treasurer
shall decide the protest within sixty (60) days from the time of its
filing.
If the local treasurer finds the protest to be wholly or partly
meritorious,
he shall issue a notice canceling wholly or partially the assessment.
However,
if the local treasurer finds the assessment to be wholly or partly
correct,
he shall deny the protest wholly or partly with notice to the taxpayer.
The taxpayer shall have thirty (30) days from the receipt of the denial
of the protest or from the lapse of the sixty (60) day period
prescribed
herein within which to appeal with the court of competent jurisdiction
otherwise the assessment becomes conclusive and unappealable.cralaw:red
SEC. 196. Claim for Refund
of Tax Credit. - No case or proceeding shall be maintained in any
court
for the recovery of any tax, fee, or charge erroneously or illegally
collected
until a written claim for refund or credit has been filed with the
local
treasurer. No case or proceeding shall be entertained in any court
after
the expiration of two (2) years from the date of the payment of such
tax,
fee, or charge, or from the date the taxpayer is entitled to a refund
or
credit.
TITLE II. REAL PROPERTY TAXATIONCHAPTER 1 - GENERAL
PROVISIONSSEC. 197. Scope. -
This
Title shall govern the administration, appraisal, assessment, levy and
collection of real property tax.
SEC. 198. Fundamental
Principles. - The appraisal, assessment, levy and collection of
real
property tax shall be guided by the following fundamental principles:chanrobles virtual law library
(a) Real property shall
be appraised at its current and fair market value;
(b) Real property shall
be classified for assessment purposes on the basis of its actual use;
(c) Real property shall
be assessed on the basis of a uniform classification within each local
government unit;
(d) The appraisal,
assessment, levy and collection of real property tax shall not be let
to
any private person; and cralaw:red
(e) The appraisal and
assessment of real property shall be equitable.cralaw:red
SEC. 199. Definitions.
- When used in this Title: (a) "Acquisition Cost" for
newly-acquired
machinery not yet depreciated and appraised within the year of its
purchase,
refers to the actual cost of the machinery to its present owner, plus
the
cost of transportation, handling, and installation at the present site;
(b) "Actual Use" refers
to the purpose for which the property is principally or predominantly
utilized
by the person in possession thereof;
(c) "Ad Valorem Tax" is a
levy on real property determined on the basis of a fixed proportion of
the value of the property;
(d) "Agricultural Land"
is land devoted principally to the planting of trees, raising of crops,
livestock and poultry, dairying, salt making, inland fishing and
similar
aquacultural activities, and other agricultural activities, and is not
classified as mineral, timber, residential, commercial or industrial
land;
(e) "Appraisal" is
the act or process of determining the value of property as of a
specific
date for a specific purpose;
(f) "Assessment" is
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;
(g) "Assessment Level"
is the percentage applied to the fair market value to determine the
taxable
value of the property;
(h) "Assessed Value"
is the fair market value of the real property multiplied by the
assessment
level. It is synonymous to taxable value;
(i) "Commercial Land"
is land devoted principally for the object of profit and is not
classified
as agricultural, industrial, mineral, timber, or residential land;
(j) "Depreciated Value"
is the value remaining after deducting depreciation from the
acquisition
cost;
(k) "Economic Life"
is the estimated period over which it is anticipated that a machinery
or
equipment may be profitably utilized;
(l) "Fair Market Value"
is the price at which a property may be sold by a seller who is not
compelled
to sell and bought by a buyer who is not compelled to buy;
(m) "Improvement" 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;
(n) "Industrial Land"
is land devoted principally to industrial activity as capital
investment
and is not classified as agricultural, commercial, timber, mineral or
residential
land;
(o) "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 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;
(p) "Mineral Lands"
are lands in which minerals, metallic or non-metallic, exist in
sufficient
quantity or grade to justify the necessary expenditures to extract and
utilize such materials;
(q) "Reassessment" is the
assigning of new assessed values to property, particularly real estate,
as the result of a general, partial, or individual reappraisal of the
property;
(r) "Remaining Economic
Life" is the period of time expressed in years from the date of
appraisal
to the date when the machinery becomes valueless;
(s) "Remaining Value"
is the value corresponding to the remaining useful life of the
machinery;
(t) "Replacement or
Reproduction Cost" is the cost that would be incurred on the basis of
current
prices, in acquiring an equally desirable substitute property, or the
cost
of reproducing a new replica of the property on the basis of current
prices
with the same or closely similar material; and cralaw:red
(u) "Residential Land"
is land principally devoted to habitation.cralaw:red
Sec. 200. Administration
of the Real Property Tax. - The provinces and cities, including the
municipalities within the Metropolitan Manila Area, shall be primarily
responsible for the proper, efficient and effective administration of
the
real property tax.
CHAPTER 2 - APPRAISAL
AND ASSESSMENT
OF REAL PROPERTYSEC. 201. Appraisal of
Real
Property. - All real property, whether taxable or exempt, shall be
appraised at the current and fair market value prevailing in the
locality
where the property is situated. The Department of Finance shall
promulgate
the necessary rules and regulations for the classification, appraisal,
and assessment of real property pursuant to the provisions of this Code.
SEC. 202. Declaration
of Real Property by the Owner or Administrator. - It shall be the
duty
of all persons, natural or juridical, owning or administering real
property,
including the improvements therein, within a city or municipality, or
their
duly authorized representative, to prepare, or cause to be prepared,
and
file with the provincial, city or municipal assessor, a sworn statement
declaring the true value of their property, whether previously declared
or undeclared, taxable or exempt, which shall be the current and fair
market
value of the property, as determined by the declarant. Such declaration
shall contain a description of the property sufficient in detail to
enable
the assessor or his deputy to identify the same for assessment
purposes.
The sworn declaration of real property herein referred to shall be
filed
with the assessor concerned once every three (3) years during the
period
from January first (1st) to June thirtieth (30th) commencing with the
calendar
year 1992.cralaw:red
SEC. 203. Duty of Person
Acquiring Real Property or Making Improvement Thereon. - It shall
also
be the duty of any person, or his authorized representative, acquiring
at any time real property in any municipality or city or making any
improvement
on real property, to prepare, or cause to be prepared, and file with
the
provincial, city or municipal assessor, a sworn statement declaring the
true value of subject property, within sixty (60) days after the
acquisition
of such property or upon completion or occupancy of the improvement,
whichever
comes earlier.cralaw:red
SEC. 204. Declaration
of Real Property by the Assessor. - When any person, natural or
juridical,
by whom real property is required to be declared under Section 202
hereof,
refuses or fails for any reason to make such declaration within the
time
prescribed, the provincial, city or municipal assessor shall himself
declare
the property in the name of the defaulting owner, if known, or against
an unknown owner, as the case may be, and shall assess the property for
taxation in accordance with the provision of this Title. No oath shall
be required of a declaration thus made by the provincial, city or
municipal
assessor.cralaw:red
SEC. 205. Listing of Real
Property in the Assessment Rolls. - (a) In every province and
city,
including the municipalities within the Metropolitan Manila Area, there
shall be prepared and maintained by the provincial, city or municipal
assessor
an assessment roll wherein shall be listed all real property, whether
taxable
or exempt, located within the territorial jurisdiction of the local
government
unit concerned. Real property shall be listed, valued and assessed in
the
name of the owner or administrator, or anyone having legal interest in
the property.cralaw:red
(b) The undivided real
property of a deceased person may be listed, valued and assessed in the
name of the estate or of the heirs and devisees without designating
them
individually; and undivided real property other than that owned by a
deceased
may be listed, valued and assessed in the name of one or more
co-owners:
Provided, however, That such heir, devisee, or co-owner shall be liable
severally and proportionately for all obligations imposed by this Title
and the payment of the real property tax with respect to the undivided
property.cralaw:red
(c) The real property of
a corporation, partnership, or association shall be listed, valued and
assessed in the same manner as that of an individual.cralaw:red
(d) Real property owned
by the Republic of the Philippines, its instrumentalities and political
subdivisions, the beneficial use of which has been granted, for
consideration
or otherwise, to a taxable person, shall be listed, valued and assessed
in the name of the possessor, grantee or of the public entity if such
property
has been acquired or held for resale or lease.cralaw:red
SEC. 206. Proof of Exemption
of Real Property from Taxation. - Every person by or for whom real
property is declared, who shall claim tax exemption for such property
under
this Title shall file with the provincial, city or municipal assessor
within
thirty (30) days from the date of the declaration of real property
sufficient
documentary evidence in support of such claim including corporate
charters,
title of ownership, articles of incorporation, bylaws, contracts,
affidavits,
certifications and mortgage deeds, and similar documents. If the
required
evidence is not submitted within the period herein prescribed, the
property
shall be listed as taxable in the assessment roll. However, if the
property
shall be proven to be tax exempt, the same shall be dropped from the
assessment
roll.cralaw:red
SEC. 207. Real Property
Identification System. - All declarations of real property made
under
the provisions of this Title shall be kept and filed under a uniform
classification
system to be established by the provincial, city or municipal assessor.
SEC. 208. Notification
of Transfer of Real Property Ownership. - Any person who shall
transfer
real property ownership to another shall notify the provincial, city or
municipal assessor concerned within sixty (60) days from the date of
such
transfer. The notification shall include the mode of transfer, the
description
of the property alienated, the name and address of the transferee.cralaw:red
SEC. 209. Duty of Registrar
of Deeds to Apprise Assessor of Real Property Listed in Registry. -
(a) To ascertain whether or not any real property entered in the
Registry
of Property has escaped discovery and listing for the purpose of
taxation,
the Registrar of Deeds shall prepare and submit to the provincial, city
or municipal assessor, within six (6) months from the date of
effectivity
of this Code and every year thereafter, an abstract of his registry,
which
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.cralaw:red
(b) It shall also be
the duty of the Registrar of Deeds to require every person who shall
present
for registration a document of transfer, alienation, or encumbrance of
real property to accompany the same with a certificate to the effect
that
the real property subject of the transfer, alienation, or encumbrance,
as the case may be, has been fully paid of all real property taxes due
thereon. Failure to provide such certificate shall be a valid cause for
the Registrar of Deeds to refuse the registration of the document.cralaw:red
SEC. 210. Duty of Official
Issuing Building Permit or Certificate of Registration of Machinery to
Transmit Copy to 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 certificate within thirty (30) days of its
issuance,
to the assessor of the province, city or municipality where the
property
is situated.cralaw:red
SEC. 211. 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
to the assessor of the province, city or municipality where the land is
located with a white or blue print copy of each of all approved
original
or subdivision plans or maps of surveys executed by them within thirty
(30) days from receipt of such plans from the Lands Management Bureau,
the Land Registration Authority, or the Housing and Land Use Regulatory
Board, as the case may be.cralaw:red
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. The schedule of fair market values shall be published in a
newspaper
of general circulation in the province, city or municipality concerned,
or in the absence thereof, shall be posted in the provincial capitol,
city
or municipal hall and in two other conspicuous public places therein.
SEC. 213. Authority of
Assessor to Take Evidence. - For the purpose of obtaining
information
on which to base the market value of any real property, the assessor of
the province, city or municipality or his deputy may summon the owners
of the properties to be affected or persons having legal interest
therein
and witnesses, administer oaths, and take deposition concerning the
property,
its ownership, amount, nature, and value.cralaw:red
SEC. 214. Amendment of
Schedule of Fair Market Values. - The provincial, city or municipal
assessor may recommend to the sanggunian concerned amendments to
correct
errors in valuation in the schedule of fair market values. The
sanggunian
concerned shall, by ordinance, act upon the recommendation within
ninety
(90) days from receipt thereof.cralaw:red
SEC. 215. Classes of Real
Property for Assessment Purposes. - For purposes of assessment,
real
property shall be classified as residential, agricultural, commercial,
industrial, mineral, timberland or special. The city or municipality
within
the Metropolitan Manila Area, through their respective sanggunian,
shall
have the power to classify lands as residential, agricultural,
commercial,
industrial, mineral, timberland, or special in accordance with their
zoning
ordinances.cralaw:red
SEC. 216. Special Classes
of Real Property. - All lands, buildings, and other improvements
thereon
actually, directly and exclusively used for hospitals, cultural, or
scientific
purposes, and those owned and used by local water districts, and
government-owned
or -controlled corporations rendering essential public services in the
supply and distribution of water and/or generation and transmission of
electric power shall be classified as special.cralaw:red
SEC. 217. Actual Use of
Real Property as Basis for Assessment. - Real property shall be
classified,
valued and assessed on the basis of its actual use regardless of where
located, whoever owns it, and whoever uses it.cralaw:red
SEC. 218. Assessment Levels.
- The assessment levels to be applied to the fair market value of real
property to determine its assessed value shall be fixed by ordinances
of
the sangguniang panlalawigan, sangguniang panlungsod or sangguniang
bayan
of a municipality within the Metropolitan Manila Area, at the rates not
exceeding the following:chanrobles virtual law library
(a) On Lands:chanroblesvirtuallawlibrary
CLASS
ASSESSMENT LEVELS
Residential
20%
Agricultural
40%
Commercial
50%
Industrial
50%
Mineral
50%
Timberland
20%
(b) On Buildings and Other
Structures:chanrobles virtual law library
(1)Residential
Fair Market Value
Over Not Over
Assessment
Levels
P 175,000.00 0%
P 175,000.00
300,000.00
10%
300,000.00
500,000.00
20%
500,000.00
750,000.00
25%
750,000.00
1,000,000.00
30%
1,000,000.00
2,000,000.00
35%
2,000,000.00
5,000,000.00
40%
5,000,000.00
10,000.000.00
50%
10,000,000.00
60%
(2) Agricultural
Fair Market Value
Over
Not Over Assessment Levels
P
300,000.00
25%
300,000.00
500,000.00
30%
500,000.00
750,000.00
35%
750,000.00
1,000,000.00
40%
1,000,000.00
2,000,000.00
45%
2,000,000.00
50%
(3) Commercial / Industrial
Fair Market Value
Over Not
Over
Assessment Levels
P
300,000.00
30%
P 300,000.00
500,000.00 35%
500,000.00
750,000.00 40%
750,000.00
1,000,000.00 50%
1,000,000.00
2,000,000.00 60%
2,000,000.00
5,000,000.00 70%
5,000,000.00
10,000,000.00
75%
10,000,000.00
80%
(4)Timber land
Fair Market Value
Over Not Over
Assessment
Levels
P 300,000.00 45%
P 300,000.00
500,000.00 50%
500,000.00
750,000.00 55%
750,000.00
1,000,000.00
60%
1,000,000.00
2,000,000.00
65%
2,000,000.0
70%
(c) On Machineries
Class
Assessment Levels
Agricultural
40%
Residential
50%
Commercial
80%
Industrial
80%
(d) On Special Classes:
The assessment levels for all lands, buildings, machineries and other
improvements;
Actual
Use
Assessment Level
Cultural
15%
Scientific
15%
Hospital
15%
local water
districts
10%
Government-owned
or
controlled
corporations
engaged
in the supply and
distribution
of water and/or
generation and
transmission of
electric
power
10%
SEC. 219. General
Revision
of assessments and Property Classification. - The provincial, city
or municipal assessor shall undertake a general revision of real
property
assessments within two (2) years after the effectivity of this Code and
every three (3) years thereafter.cralaw:red
SEC. 220. Valuation of
Real Property. - In cases where (a) real property is declared and
listed
for taxation purposes for the first time; (b) there is an ongoing
general
revision of property classification and assessment; or (c) a request is
made by the person in whose name the property is declared, the
provincial,
city or municipal assessor or his duly authorized deputy shall, in
accordance
with the provisions of this Chapter, make a classification, appraisal
and
assessment of the real property listed and described in the declaration
irrespective of any previous assessment or taxpayer's valuation
thereon:
Provided, however, That the assessment of real property shall not be
increased
oftener than once every three (3) years except in case of new
improvements
substantially increasing the value of said property or of any change in
its actual use.cralaw:red
SEC. 221. Date of Effectivity
of Assessment or Reassessment. - All assessments or reassessments
made
after the first (1st) day of January of any year shall take effect on
the
first (1st) day of January of the succeeding year: Provided, however,
That
the reassessment of real property due to its partial or total
destruction,
or to a major change in its actual use, or to any great and sudden
inflation
or deflation of real property values, or to the gross illegality of the
assessment when made or to any other abnormal cause, shall be made
within
ninety (90) days from the date any such cause or causes occurred, and
shall
take effect at the beginning of the quarter next following the
reassessment.cralaw:red
SEC. 222. assessment of
Property Subject to Back Taxes. - Real property declared for the
first
time shall be assessed for taxes for the period during which it would
have
been liable but in no case for more than ten (10) years prior to the
date
of initial assessment: Provided, however, That such taxes shall be
computed
on the basis of the applicable schedule of values in force during the
corresponding
period. If such taxes are paid on or before the end of the quarter
following
the date the notice of assessment was received by the owner or his
representative,
no interest for delinquency shall be imposed thereon; otherwise, such
taxes
shall be subject to an interest at the rate of two percent (2%) per
month
or a fraction thereof from the date of the receipt of the assessment
until
such taxes are fully paid.cralaw:red
SEC. 223. Notification
of New or Revised Assessment. - When real property is assessed for
the first time or when an existing assessment is increased or
decreased,
the provincial, city or municipal assessor shall within thirty (30)
days
give written notice of such new or revised assessment to the person in
whose name the property is declared. The notice may be delivered
personally
or by registered mail or through the assistance of the punong barangay
to the last known address of the person to be served.cralaw:red
SEC. 224. Appraisal and
Assessment of Machinery. - (a) The fair market value of a brand-new
machinery shall be the acquisition cost. In all other cases, the fair
market
value shall be determined by dividing the remaining economic life of
the
machinery by its estimated economic life and multiplied by the
replacement
or reproduction cost.cralaw:red
(b) If the machinery
is imported, the acquisition cost includes freight, insurance, bank and
other charges, brokerage, arrastre and handling, duties and taxes, plus
cost of inland transportation, handling, and installation charges at
the
present site. The cost in foreign currency of imported machinery shall
be converted to peso cost on the basis of foreign currency exchange
rates
as fixed by the Central Bank.cralaw:red
SEC. 225. Depreciation
Allowance for Machinery. - For purposes of assessment, a
depreciation
allowance shall be made for machinery at a rate not exceeding five
percent
(5%) of its original cost or its replacement or reproduction cost, as
the
case may be, for each year of use: Provided, however, That the
remaining
value for all kinds of machinery shall be fixed at not less than twenty
percent (20%) of such original, replacement, or reproduction cost for
so
long as the machinery is useful and in operation.
CHAPTER 3 - ASSESSMENT
APPEALSSEC. 226. Local Board
of
Assessment Appeals. - Any owner or person having legal interest in
the property who is not satisfied with the action of the provincial,
city
or municipal assessor in the assessment of his property may, within
sixty
(60) days from the date of receipt of the written notice of assessment,
appeal to the Board of Assessment appeals of the province or city by
filing
a petition under oath in the form prescribed for the purpose, together
with copies of the tax declarations and such affidavits or documents
submitted
in support of the appeal.
SEC. 227. Organization,
Powers, Duties, and Functions of the Local Board of Assessment Appeals.
- (a) The Board of Assessment appeals of the province or city shall be
composed of the Registrar of Deeds, as Chairman, the provincial or city
prosecutor and the provincial, or city engineer as members, who shall
serve
as such in an ex officio capacity without additional compensation.cralaw:red
(b) The chairman of
the Board shall have the power to designate any employee of the
province
or city to serve as secretary to the Board also without additional
compensation.cralaw:red
(c) The chairman and
members of the Board of Assessment appeals of the province or city
shall
assume their respective positions without need of further appointment
or
special designation immediately upon effectivity of this Code. They
shall
take an oath or affirmation of office in the prescribed form.cralaw:red
(d) In provinces and
cities without a provincial or city engineer, the district engineer
shall
serve as member of the Board. In the absence of the Registrar of Deeds,
or the provincial or city prosecutor, or the provincial or city
engineer,
or the district engineer, the persons performing their duties, whether
in an acting capacity or as a duly designated officer-in-charge, shall
automatically become the chairman or member, respectively, of the said
Board, as the case may be.cralaw:red
SEC. 228. Meetings and
Expenses of the Local Board of Assessment Appeals. - (a) The Board
of Assessment appeals of the province or city shall meet once a month
and
as often as may be necessary for the prompt disposition of appealed
cases.
No member of the Board shall be entitled to per diems or traveling
expenses
for his attendance in Board meetings, except when conducting an ocular
inspection in connection with a case under appeal.cralaw:red
(b) All expenses of
the Board shall be charged against the general fund of the province or
city, as the case may be. The sanggunian concerned shall appropriate
the
necessary funds to enable the Board in their respective localities to
operate
effectively.cralaw:red
SEC. 229. Action by the
Local Board of Assessment appeals. - (a) The Board shall decide the
appeal within one hundred twenty (120) days from the date of receipt of
such appeal. The Board, after hearing, shall render its decision based
on substantial evidence or such relevant evidence on record as a
reasonable
mind might accept as adequate to support the conclusion.cralaw:red
(b) In the exercise
of its appellate jurisdiction, the Board shall have the power to summon
witnesses, administer oaths, conduct ocular inspection, take
depositions,
and issue subpoena and subpoena duces tecum. The proceedings of the
Board
shall be conducted solely for the purpose of ascertaining the facts
without
necessarily adhering to technical rules applicable in judicial
proceedings.cralaw:red
(c) The secretary of
the Board shall furnish the owner of the property or the person having
legal interest therein and the provincial or city assessor with a copy
of the decision of the Board. In case the provincial or city assessor
concurs
in the revision or the assessment, it shall be his duty to notify the
owner
of the property or the person having legal interest therein of such
fact
using the form prescribed for the purpose. The owner of the property or
the person having legal interest therein or the assessor who is not
satisfied
with the decision of the Board, may, within thirty (30) days after
receipt
of the decision of said Board, appeal to the Central Board of
Assessment
appeals, as herein provided. The decision of the Central Board shall be
final and executory.cralaw:red
SEC. 230. Central Board
of Assessment appeals.- The Central Board of Assessment appeals
shall
be composed of a chairman and two (2) members to be appointed by the
President,
who shall serve for a term of seven (7) years, without reappointment.
Of
those first appointed, the chairman shall hold office for seven (7)
years,
one member for five (5) years, and the other member for three (3)
years.
Appointment to any vacancy shall be only for the unexpired portion of
the
term of the predecessor. In no case shall any member be appointed or
designated
in a temporary or acting capacity. The chairman and the members of the
Board shall be Filipino citizens, at least forty (40) years old at the
time of their appointment, and members of the Bar or Certified Public
Accountants
for at least ten (10) years immediately preceding their appointment.
The
chairman of the Board of Assessment appeals shall have the salary grade
equivalent to the rank of Director III under the Salary Standardization
Law exclusive of allowances and other emoluments. The members of the
Board
shall have the salary grade equivalent to the rank of Director II under
the Salary Standardization Law exclusive of allowances and other
emoluments.
The Board shall have appellate jurisdiction over all assessment cases
decided
by the Local Board of Assessment appeals.cralaw:red
There shall be Hearing
Officers to be appointed by the Central Board of Assessment appeals
pursuant
to civil service laws, rules and regulations, one each for Luzon,
Visayas
and Mindanao, who shall hold office in Manila, Cebu City and Cagayan de
Oro City, respectively, and who shall serve for a term of six (6)
years,
without reappointment until their successors have been appointed and
qualified.
The Hearing Officers shall have the same qualifications as that of the
Judges of the Municipal Trial Courts.cralaw:red
The Hearing Officers
shall each have the salary grade equivalent to the rank of Director I
under
the Salary Standardization Law exclusive of allowances and other
emoluments.
The Hearing Officers shall try and receive evidences on the appealed
assessment
cases as may be directed by the Board.cralaw:red
The Central Board Assessment
appeals, in the performance of its powers and duties, may establish and
organize staffs, offices, units, prescribe the titles, functions and
duties
of their members and adopt its own rules and regulations. Unless
otherwise
provided by law, the annual appropriations for the Central Board of
Assessment
appeals shall be included in the annual budget of the Department of
Finance
in the corresponding General Appropriations Act.cralaw:red
SEC. 231. Effect of appeal
on the Payment of Real Property Tax. - appeal on assessments of
real
property made under the provisions of this Code shall, in no case,
suspend
the collection of the corresponding realty taxes on the property
involved
as assessed by the provincial or city assessor, without prejudice to
subsequent
adjustment depending upon the final outcome of the appeal.
CHAPTER 4 - IMPOSITION
OF
REAL PROPERTY TAXSEC. 232. Power to
Levy Real
Property Tax. - A province or city or a municipality within the
Metropolitan
Manila Area may levy an annual ad valorem tax on real property such as
land, building, machinery, and other improvement not hereinafter
specifically
exempted.
SEC. 233. Rates of Levy.
- A province or city or a municipality within the Metropolitan Manila
Area
shall fix a uniform rate of basic real property tax applicable to their
respective localities as follows: (a) In the case of a province, at the
rate not exceeding one percent (1%) of the assessed value of real
property; and cralaw:red
(b) In the case of
a city or a municipality within the Metropolitan Manila Area, at the
rate
not exceeding two percent (2%) of the assessed value of real property.cralaw:red
SEC. 234. Exemptions from
Real Property Tax. - The following are exempted from payment of the
real property tax:chanrobles virtual law library
(a) Real property owned
by the Republic of the Philippines or any of its political subdivisions
except when the beneficial use thereof has been granted, for
consideration
or otherwise, to a taxable person;
(b) Charitable institutions,
churches, parsonages or convents appurtenant thereto, mosques,
nonprofit
or religious cemeteries and all lands, buildings, and improvements
actually,
directly, and exclusively used for religious, charitable or educational
purposes;
(c) All machineries
and equipment that are actually, directly and exclusively used by local
water districts and government-owned or -controlled corporations
engaged
in the supply and distribution of water and/or generation and
transmission
of electric power;
(d) All real property
owned by duly registered cooperatives as provided for under R. A. No.
6938; and cralaw:red
(e) Machinery and equipment
used for pollution control and environmental protection. Except as
provided
herein, any exemption from payment of real property tax previously
granted
to, or presently enjoyed by, all persons, whether natural or juridical,
including all government-owned or -controlled corporations are hereby
withdrawn
upon the effectivity of this Code.
CHAPTER 5 - SPECIAL
LEVIES
ON REAL PROPERTYSEC. 235. Additional
Levy
on Real Property for the Special Education Fund. - A province or
city,
or a municipality within the Metropolitan Manila Area, may levy and
collect
an annual tax of one percent (1%) on the assessed value of real
property
which shall be in addition to the basic real property tax. The proceeds
thereof shall exclusively accrue to the Special Education Fund (SEF).
SEC. 236. Additional Ad
Valorem Tax on Idle Lands. - A province or city, or a municipality
within the Metropolitan Manila Area, may levy an annual tax on idle
lands
at the rate not exceeding five percent (5%) of the assessed value of
the
property which shall be in addition to the basic real property tax.cralaw:red
SEC. 237. Idle Lands,
Coverage. - For purposes of real property taxation, idle lands
shall
include the following:chanrobles virtual law library
(a) "Agricultural lands,
more than one (1) hectare in area, suitable for cultivation, dairying,
inland fishery, and other agricultural uses, one-half (1/2) of which
remain
uncultivated or unimproved by the owner of the property or person
having
legal interest therein." Agricultural lands planted to permanent or
perennial
crops with at least fifty (50) trees to a hectare shall not be
considered
idle lands. Lands actually used for grazing purposes shall likewise not
be considered idle lands.cralaw:red
(b) Lands, other than
agricultural, located in a city or municipality, more than one thousand
(1,000) square meters in area one-half (1/2) of which remain unutilized
or unimproved by the owner of the property or person having legal
interest
therein. Regardless of land area, this Section shall likewise apply to
residential lots in subdivisions duly approved by proper authorities,
the
ownership of which has been transferred to individual owners, who shall
be liable for the additional tax: Provided, however, That individual
lots
of such subdivisions, the ownership of which has not been transferred
to
the buyer shall be considered as part of the subdivision, and shall be
subject to the additional tax payable by subdivision owner or operator.cralaw:red
SEC. 238. Idle Lands Exempt
from Tax. - A province or city or a municipality within the
Metropolitan
Manila Area may exempt idle lands from the additional levy by reason of
force majeure, civil disturbance, natural calamity or any cause or
circumstance
which physically or legally prevents the owner of the property or
person
having legal interest therein from improving, utilizing or cultivating
the same.cralaw:red
SEC. 239. Listing of Idle
Lands by the Assessor. - The provincial, city or municipal assessor
shall make and keep an updated record of all idle lands located within
his area of jurisdiction. For purposes of collection, the provincial,
city
or municipal assessor shall furnish a copy thereof to the provincial or
city treasurer who shall notify, on the basis of such record, the owner
of the property or person having legal interest therein of the
imposition
of the additional tax.cralaw:red
SEC. 240. Special Levy
by Local Government Units. - A province, city or municipality may
impose
a special levy on the lands comprised within its territorial
jurisdiction
specially benefited by public works projects or improvements funded by
the local government unit concerned: Provided, however, That the
special
levy shall not exceed sixty percent (60%) of the actual cost of such
projects
and improvements, including the costs of acquiring land and such other
real property in connection therewith: Provided, further, That the
special
levy shall not apply to lands exempt from basic real property tax and
the
remainder of the land portions of which have been donated to the local
government unit concerned for the construction of such projects or
improvements.cralaw:red
SEC. 241. Ordinance Imposing
a Special Levy. - A tax ordinance imposing a special levy shall
describe
with reasonable accuracy the nature, extent, and location of the public
works projects or improvements to be undertaken, state the estimated
cost
thereof, specify the metes and bounds by monuments and lines and the
number
of annual installments for the payment of the special levy which in no
case shall be less than five (5) nor more than ten (10) years. The
sanggunian
concerned shall not be obliged, in the apportionment and computation of
the special levy, to establish a uniform percentage of all lands
subject
to the payment of the tax for the entire district, but it may fix
different
rates for different parts or sections thereof, depending on whether
such
land is more or less benefited by the proposed work.cralaw:red
SEC. 242. Publication
of Proposed Ordinance Imposing a Special Levy. - Before the
enactment
of an ordinance imposing a special levy, the sanggunian concerned shall
conduct a public hearing thereon; notify in writing the owners of the
real
property to be affected or the persons having legal interest therein as
to the date and place thereof and afford the latter the opportunity to
express their positions or objections relative to the proposed
ordinance.cralaw:red
SEC. 243. Fixing the Amount
of Special Levy. - The special levy authorized herein shall be
apportioned,
computed, and assessed according to the assessed valuation of the lands
affected as shown by the books of the assessor concerned, or its
current
assessed value as fixed by said assessor if the property does not
appear
of record in his books. Upon the effectivity of the ordinance imposing
special levy, the assessor concerned shall forthwith proceed to
determine
the annual amount of special levy assessed against each parcel of land
comprised within the area especially benefited and shall send to each
landowner
a written notice thereof by mail, personal service or publication in
appropriate
cases.cralaw:red
SEC. 244. Taxpayers' Remedies
Against Special Levy. - Any owner of real property affected by a
special
levy or any person having a legal interest therein may, upon receipt of
the written notice of assessment of the special levy, avail of the
remedies
provided for in Chapter 3, Title Two, Book II of this Code.cralaw:red
SEC. 245. Accrual of Special
Levy. -The special levy shall accrue on the first day of the
quarter
next following the effectivity of the ordinance imposing such levy.
CHAPTER 6 - COLLECTION
OF REAL
PROPERTY TAXSEC. 246. Date of
Accrual
of Tax.- The real property tax for any year shall accrue on the
first
day of January and from that date it shall constitute a lien on the
property
which shall be superior to any other lien, mortgage, or encumbrance of
any kind whatsoever, and shall be extinguished only upon the payment of
the delinquent tax.
SEC. 247. Collection of
Tax. - The collection of the real property tax with interest
thereon
and related expenses, and the enforcement of the remedies provided for
in this Title or any applicable laws, shall be the responsibility of
the
city or municipal treasurer concerned. The city or municipal treasurer
may deputize the barangay treasurer to collect all taxes on real
property
located in the barangay: Provided, That the barangay treasurer is
properly
bonded for the purpose: Provided, further, That the premium on the bond
shall be paid by the city or municipal government concerned.cralaw:red
SEC. 248. Assessor to
Furnish Local Treasurer with Assessment Roll. - The provincial,
city
or municipal assessor shall prepare and submit to the treasurer of the
local government unit, on or before the thirty-first (31st) day of
December
each year, an assessment roll containing a list of all persons whose
real
properties have been newly assessed or reassessed and the values of
such
properties.cralaw:red
SEC. 249. Notice of Time
for Collection of Tax. - The city or municipal treasurer shall, on
or before the thirty-first (31st) day of January each year, in the case
of the basic real property tax and the additional tax for the Special
Education
Fund (SEF) or on any other date to be prescribed by the sanggunian
concerned
in the case of any other tax levied under this Title, post the notice
of
the dates when the tax may be paid without interest at a conspicuous
and
publicly accessible place at the city or municipal hall. Said notice
shall
likewise be published in a newspaper of general circulation in the
locality
once a week for two (2) consecutive weeks.cralaw:red
SEC. 250. Payment of Real
Property Taxes in Installments. - The owner of the real property or
the person having legal interest therein may pay the basic real
property
tax and the additional tax for Special Education Fund (SEF) due thereon
without interest in four (4) equal installments; the first installment
to be due and payable on or before March Thirty-first (31st); the
second
installment, on or before June Thirty (30); the third installment, on
or
before September Thirty (30); and the last installment on or before
December
Thirty-first (31st), except the special levy the payment of which shall
be governed by ordinance of the sanggunian concerned. The date for the
payment of any other tax imposed under this Title without interest
shall
be prescribed by the sanggunian concerned. Payments of real property
taxes
shall first be applied to prior years delinquencies, interests, and
penalties,
if any, and only after said delinquencies are settled may tax payments
be credited for the current period.cralaw:red
SEC. 251. Tax Discount
for Advanced Prompt Payment. - If the basic real property tax and
the
additional tax accruing to the Special Education Fund (SEF) are paid in
advance in accordance with the prescribed schedule of payment as
provided
under Section 250, the sanggunian concerned may grant a discount not
exceeding
twenty percent (20%) of the annual tax due.cralaw:red
SEC. 252. Payment Under
Protest. - (a) No protest shall be entertained unless the taxpayer
first pays the tax. There shall be annotated on the tax receipts the
words
"paid under protest". The protest in writing must be filed within
thirty
(30) days from payment of the tax to the provincial, city treasurer or
municipal treasurer, in the case of a municipality within Metropolitan
Manila Area, who shall decide the protest within sixty (60) days from
receipt.cralaw:red
(b) The tax or a portion
thereof paid under protest, shall be held in trust by the treasurer
concerned.cralaw:red
(c) In the event that
the protest is finally decided in favor of the taxpayer, the amount or
portion of the tax protested shall be refunded to the protestant, or
applied
as tax credit against his existing or future tax liability.cralaw:red
(d) In the event that
the protest is denied or upon the lapse of the sixty day period
prescribed
in subparagraph (a), the taxpayer may avail of the remedies as provided
for in Chapter 3, Title II, Book II of this Code.cralaw:red
SEC. 253. Repayment of
Excessive Collections. - When an assessment of basic real property
tax, or any other tax levied under this Title, is found to be illegal
or
erroneous and the tax is accordingly reduced or adjusted, the taxpayer
may file a written claim for refund or credit for taxes and interests
with
the provincial or city treasurer within two (2) years from the date the
taxpayer is entitled to such reduction or adjustment. The provincial or
city treasurer shall decide the claim for tax refund or credit within
sixty
(60) days from receipt thereof. In case the claim for tax refund or
credit
is denied, the taxpayer may avail of the remedies as provided in
Chapter
3, Title II, Book II of this Code.cralaw:red
SEC. 254. Notice of Delinquency
in the Payment of the Real Property Tax. - (a) When the real
property
tax or any other tax imposed under this Title becomes delinquent, the
provincial,
city or municipal treasurer shall immediately cause a notice of the
delinquency
to be posted at the main entrance of the provincial capitol, or city or
municipal hall and in a publicly accessible and conspicuous place in
each
barangay of the local government unit concerned. The notice of
delinquency
shall also be published once a week for two (2) consecutive weeks, in a
newspaper of general circulation in the province, city, or municipality.cralaw:red
(b) Such notice shall
specify the date upon which the tax became delinquent and shall state
that
personal property may be distrained to effect payment. It shall
likewise
state that at any time before the distraint of personal property,
payment
of the tax with surcharges, interests and penalties may be made in
accordance
with the next following Section, and unless the tax, surcharges and
penalties
are paid before the expiration of the year for which the tax is due
except
when the notice of assessment or special levy is contested
administratively
or judicially pursuant to the provisions of Chapter 3, Title II, Book
II
of this Code, the delinquent real property will be sold at public
auction,
and the title to the property will be vested in the purchaser, subject,
however, to the right of the delinquent owner of the property or any
person
having legal interest therein to redeem the property within one (1)
year
from the date of sale.cralaw:red
SEC. 255. Interests on
Unpaid Real Property Tax. - In case of failure to pay the basic
real
property tax or any other tax levied under this Title upon the
expiration
of the periods as provided in Section 250, or when due, as the case may
be, shall subject the taxpayer to the payment of interest at the rate
of
two percent (2%) per month on the unpaid amount or a fraction thereof,
until the delinquent tax shall have been fully paid: Provided, however,
That in no case shall the total interest on the unpaid tax or portion
thereof
exceed thirty-six (36) months.cralaw:red
SEC. 256. Remedies For
The Collection Of Real Property Tax. - For the collection of the
basic
real property tax and any other tax levied under this Title, the local
government unit concerned may avail of the remedies by administrative
action
thru levy on real property or by judicial action.cralaw:red
SEC. 257. Local Governments
Lien. - The basic real property tax and any other tax levied under
this Title constitutes a lien on the property subject to tax, superior
to all liens, charges or encumbrances in favor of any person,
irrespective
of the owner or possessor thereof, enforceable by administrative or
judicial
action, and may only be extinguished upon payment of the tax and the
related
interests and expenses.cralaw:red
SEC. 258. Levy on Real
Property. - After the expiration of the time required to pay the
basic
real property tax or any other tax levied under this Title, real
property
subject to such tax may be levied upon through the issuance of a
warrant
on or before, or simultaneously with, the institution of the civil
action
for the collection of the delinquent tax. The provincial or city
treasurer,
or a treasurer of a municipality within the Metropolitan Manila Area,
as
the case may be, when issuing a warrant of levy shall prepare a duly
authenticated
certificate showing the name of the delinquent owner of the property or
person having legal interest therein, the description of the property,
the amount of the tax due and the interest thereon. The warrant shall
operate
with the force of a legal execution throughout the province, city or a
municipality within the Metropolitan Manila Area. The warrant shall be
mailed to or served upon the delinquent owner of the real property or
person
having legal interest therein, or in case he is out of the country or
cannot
be located, to the administrator or occupant of the property. At the
same
time, written notice of the levy with the attached warrant shall be
mailed
to or served upon the assessor and the Registrar of Deeds of the
province,
city or a municipality within the Metropolitan Manila Area where the
property
is located, who shall annotate the levy on the tax declaration and
certificate
of title of the property, respectively. The levying officer shall
submit
a report on the levy to the sanggunian concerned within ten (10) days
after
receipt of the warrant by the owner of the property or person having
legal
interest therein.cralaw:red
SEC. 259. Penalty for
Failure to Issue and Execute Warrant. - Without prejudice to
criminal
prosecution under the Revised Penal Code and other applicable laws, any
local treasurer or his deputy who fails to issue or execute the warrant
of levy within one (1) year from the time the tax becomes delinquent or
within thirty (30) days from the date of the issuance thereof, or who
is
found guilty of abusing the exercise thereof in an administrative or
judicial
proceeding shall be dismissed from the service.cralaw:red
SEC. 260. Advertisement
and Sale. - Within thirty (30) days after service of the warrant of
levy, the local treasurer shall proceed to publicly advertise for sale
or auction the property or a usable portion thereof as may be necessary
to satisfy the tax delinquency and expenses of sale. The advertisement
shall be effected by posting a notice at the main entrance of the
provincial,
city or municipal building, and in a publicly accessible and
conspicuous
place in the barangay where the real property is located, and by
publication
once a week for two (2) weeks in a newspaper of general circulation in
the province, city or municipality where the property is located. The
advertisement
shall specify the amount of the delinquent tax, the interest due
thereon
and expenses of sale, the date and place of sale, the name of the owner
of the real property or person having legal interest therein, and a
description
of the property to be sold. At any time before the date fixed for the
sale,
the owner of the real property or person having legal interest therein
may stay the proceedings by paying the delinquent tax, the interest due
thereon and the expenses of sale. The sale shall be held either at the
main entrance of the provincial, city or municipal building, or on the
property to be sold, or at any other place as specified in the notice
of
the sale. Within thirty (30) days after the sale, the local treasurer
or
his deputy shall make a report of the sale to the sanggunian concerned,
and which shall form part of his records. The local treasurer shall
likewise
prepare and deliver to the purchaser a certificate of sale which shall
contain the name of the purchaser, a description of the property sold,
the amount of the delinquent tax, the interest due thereon, the
expenses
of sale and a brief description of the proceedings: Provided, however,
That proceeds of the sale in excess of the delinquent tax, the interest
due thereon, and the expenses of sale shall be remitted to the owner of
the real property or person having legal interest therein. The local
treasurer
may, by ordinance duly approved, advance an amount sufficient to defray
the costs of collection thru the remedies provided for in this Title,
including
the expenses of advertisement and sale.cralaw:red
SEC. 261. Redemption of
Property Sold. - Within one (1) year from the date of sale, the
owner
of the delinquent real property or person having legal interest
therein,
or his representative, shall have the right to redeem the property upon
payment to the local treasurer of the amount of the delinquent tax,
including
the interest due thereon, and the expenses of sale from the date of
delinquency
to the date of sale, plus interest of not more than two percent (2%)
per
month on the purchase price from the date of sale to the date of
redemption.
Such payment shall invalidate the certificate of sale issued to the
purchaser
and the owner of the delinquent real property or person having legal
interest
therein shall be entitled to a certificate of redemption which shall be
issued by the local treasurer or his deputy. From the date of sale
until
the expiration of the period of redemption, the delinquent real
property
shall remain in the possession of the owner or person having legal
interest
therein who shall be entitled to the income and other fruits thereof.
The
local treasurer or his deputy, upon receipt from the purchaser of the
certificate
of sale, shall forthwith return to the latter the entire amount paid by
him plus interest of not more than two percent (2%) per month.
Thereafter,
the property shall be free from the lien of such delinquent tax,
interest
due thereon and expenses of sale.cralaw:red
SEC. 262. Final Deed to
Purchaser. - In case the owner or person having legal interest
therein
fails to redeem the delinquent property as provided herein, the local
treasurer
shall execute a deed conveying to the purchaser said property, free
from
lien of the delinquent tax, interest due thereon and expenses of sale.
The deed shall briefly state the proceedings upon which the validity of
the sale rests.cralaw:red
SEC. 263. Purchase of
Property By the Local Government Units for Want of Bidder. - In
case
there is no bidder for the real property advertised for sale as
provided
herein, or if the highest bid is for an amount insufficient to pay the
real property tax and the related interest and costs of sale the local
treasurer conducting the sale shall purchase the property in behalf of
the local government unit concerned to satisfy the claim and within two
(2) days thereafter shall make a report of his proceedings which shall
be reflected upon the records of his office. It shall be the duty of
the
Registrar of Deeds concerned upon registration with his office of any
such
declaration of forfeiture to transfer the title of the forfeited
property
to the local government unit concerned without the necessity of an
order
from a competent court. Within one (1) year from the date of such
forfeiture,
the taxpayer or any of his representative, may redeem the property by
paying
to the local treasurer the full amount of the real property tax and the
related interest and the costs of sale. If the property is not redeemed
as provided herein, the ownership thereof shall be fully vested on the
local government unit concerned.cralaw:red
SEC. 264. Resale of Real
Estate Taken for Taxes, Fees, or Charges. - The sanggunian
concerned
may, by ordinance duly approved, and upon notice of not less than
twenty
(20) days, sell and dispose of the real property acquired under the
preceding
section at public auction. The proceeds of the sale shall accrue to the
general fund of the local government unit concerned.cralaw:red
SEC. 265. Further Distraint
or Levy. - Levy may be repeated if necessary until the full amount
due, including all expenses, is collected.cralaw:red
SEC. 266. Collection of
Real Property Tax Through the Courts. - The local government unit
concerned
may enforce the collection of the basic real property tax or any other
tax levied under this Title by civil action in any court of competent
jurisdiction.
The civil action shall be filed by the local treasurer within the
period
prescribed in Section 270 of this Code.cralaw:red
SEC. 267. Action Assailing
Validity of Tax Sale. - No court shall entertain any action
assailing
the validity of any sale at public auction of real property or rights
therein
under this Title until the taxpayer shall have deposited with the court
the amount for which the real property was sold, together with interest
of two percent (2%) per month from the date of sale to the time of the
institution of the action. The amount so deposited shall be paid to the
purchaser at the auction sale if the deed is declared invalid but it
shall
be returned to the depositor if the action fails. Neither shall any
court
declare a sale at public auction invalid by reason of irregularities or
informalities in the proceedings unless the substantive rights of the
delinquent
owner of the real property or the person having legal interest therein
have been impaired.cralaw:red
SEC. 268. Payment of Delinquent
Taxes on Property Subject of Controversy. - In any action
involving
the ownership or possession of, or succession to, real property, the
court
may, motu propio or upon representation of the provincial, city, or
municipal
treasurer or his deputy, award such ownership, possession, or
succession
to any party to the action upon payment to the court of the taxes with
interest due on the property and all other costs that may have accrued,
subject to the final outcome of the action.cralaw:red
SEC. 269. Treasurer to
Certify Delinquencies Remaining Uncollected. - The provincial,
city
or municipal treasurer or their deputies shall prepare a certified list
of all real property tax delinquencies which remained uncollected or
unpaid
for at least one (1) year in his jurisdiction, and a statement of the
reason
or reasons for such non-collection or non-payment, and shall submit the
same to the sanggunian concerned on or before December thirty-first
(31st)
of the year immediately succeeding the year in which the delinquencies
were incurred, with a request for assistance in the enforcement of the
remedies for collection provided herein.cralaw:red
SEC. 270. Periods Within
Which To Collect Real Property Taxes. - The basic real property tax
and any other tax levied under this Title shall be collected within
five
(5) years from the date they become due. No action for the collection
of
the tax, whether administrative or judicial, shall be instituted after
the expiration of such period. In case of fraud or intent to evade
payment
of the tax, such action may be instituted for the collection of the
same
within ten (10) years from the discovery of such fraud or intent to
evade
payment. The period of prescription within which to collect shall be
suspended
for the time during which:chanrobles virtual law library
(1) The local treasurer
is legally prevented from collecting the tax;
(2) The owner of the
property or the person having legal interest therein requests for
reinvestigation
and executes a waiver in writing before the expiration of the period
within
which to collect; and cralaw:red
(3) The owner of the
property or the person having legal interest therein is out of the
country
or otherwise cannot be located.
CHAPTER 7 - DISPOSITION
OF
PROCEEDSSEC. 271. Distribution
of
Proceeds. - The proceeds of the basic real property tax, including
interest thereon, and proceeds from the use, lease or disposition, sale
or redemption of property acquired at a public auction in accordance
with
the provisions of this Title by the province or city or a municipality
within the Metropolitan Manila Area shall be distributed as follows:chanroblesvirtuallawlibrary
(a) In the case of
provinces:chanrobles virtual law library
(1) province - Thirty-five
percent (35%) shall accrue to the general fund;
(2) municipality -
Forty percent (40%) to the general fund of the municipality where the
property
is located; and cralaw:red
(3) barangay - Twenty-five
percent (25%) shall accrue to the barangay where the property is
located.cralaw:red
(b) In the case of
cities:chanrobles virtual law library
(1) city - Seventy percent
(70%) shall accrue to the general fund of the city; and cralaw:red
(2) Thirty percent
(30%) shall be distributed among the component barangays of the cities
where the property is located in the following manner:chanrobles virtual law library
(i) Fifty percent (50%)
shall accrue to the barangay where the property is located;
(ii) Fifty percent
(50%) shall accrue equally to all component barangays of the city; and cralaw:red
(c) In the case of
a municipality within the Metropolitan Manila Area:chanrobles virtual law library
(1) Metropolitan Manila
Authority - Thirty-five percent (35%) shall accrue to the general fund
of the authority;
(2) municipality -
Thirty-five percent (35%) shall accrue to the general fund of the
municipality
where the property is located;
(3) barangays - Thirty
percent (30%) shall be distributed among the component barangays of the
municipality where the property is located in the following manner:chanrobles virtual law library
(i) Fifty percent (50%)
shall accrue to the barangay where the property is located;
(ii) Fifty percent
(50%) shall accrue equally to all component barangays of the
municipality.cralaw:red
(d) The share of each
barangay shall be released, without need of any further action,
directly
to the barangay treasurer on a quarterly basis within five (5) days
after
the end of each quarter and shall not be subject to any lien or
holdback
for whatever purpose.cralaw:red
SEC. 272. Application
of Proceeds of the Additional One Percent SEF Tax. - The proceeds
from
the additional one percent (1%) tax on real property accruing to the
Special
Education Fund (SEF) shall be automatically released to the local
school
boards: Provided, That, in case of provinces, the proceeds shall be
divided
equally between the provincial and municipal school boards: Provided,
however,
That the proceeds shall be allocated for the operation and maintenance
of public schools, construction and repair of school buildings,
facilities
and equipment, educational research, purchase of books and periodicals,
and sports development as determined and approved by the Local School
Board.cralaw:red
SEC. 273. Proceeds of
the Tax on Idle Lands. - The proceeds of the additional real
property
tax on idle lands shall accrue to the respective general fund of the
province
or city where the land is located. In the case of a municipality within
the Metropolitan Manila Area, the proceeds shall accrue equally to the
Metropolitan Manila Authority and the municipality where the land is
located.cralaw:red
SEC. 274. Proceeds of
the Special Levy. - The proceeds of the special levy on lands
benefited
by public works, projects and other improvements shall accrue to the
general
fund of the local government unit which financed such public works,
projects
or other improvements.
CHAPTER 8 -
SPECIAL PROVISIONSSEC. 275. General
Assessment
Revision; Expenses Incident Thereto. - The sanggunian of provinces,
cities and municipalities within the Metropolitan Manila Area shall
provide
the necessary appropriations to defray the expenses incident to the
general
revision of real property assessment. All expenses incident to a
general
revision of real property assessments shall, by ordinance of the
sangguniang
panlalawigan, be apportioned between the province and the municipality
on the basis of the taxable area of the municipality concerned.
SEC. 276. Condonation
or Reduction of Real Property Tax and Interest. - In case of a
general
failure of crops or substantial decrease in the price of agricultural
or
agribased products, or calamity in any province, city, or municipality,
the sanggunian concerned, by ordinance passed prior to the first (1st)
day of January of any year and upon recommendation of the Local
Disaster
Coordinating Council, may condone or reduce, wholly or partially, the
taxes
and interest thereon for the succeeding year or years in the city or
municipality
affected by the calamity.cralaw:red
SEC. 277. Condonation
or Reduction of Tax by the President of the Philippines. - The
President
of the Philippines may, when public interest so requires, condone or
reduce
the real property tax and interest for any year in any province or city
or a municipality within the Metropolitan Manila Area.cralaw:red
SEC. 278. 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 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.cralaw:red
SEC. 279. Insurance Companies
to Furnish Information. - Insurance companies are hereby required
to
furnish the provincial, city or municipal assessor copies of any
contract
or policy insurance on buildings, structures, and improvements insured
by them or such other documents which may be necessary for the proper
assessment
thereof.cralaw:red
SEC. 280. Fees in Court
Actions. - All court actions, criminal or civil, instituted at the
instance of the provincial, city or municipal treasurer or assessor
under
the provisions of this Code, shall be exempt from the payment of court
and sheriff's fees.cralaw:red
SEC. 281. Fees in Registration
of Papers or Documents on Sale of Delinquent Real Property to province,
City or municipality. - All certificates, documents, and papers
covering
the sale of delinquent property to the province, city or municipality,
if registered in the Registry of Property, shall be exempt from the
documentary
stamp tax and registration fees.cralaw:red
SEC. 282. Real Property
Assessment Notices or Owner's Copies of Tax Declarations to be Exempt
from
Postal Charges or Fees. - All real property assessment notices or
owner's
copies of tax declaration sent through the mails by the assessor shall
be exempt from the payment of postal charges or fees.cralaw:red
SEC. 283. Sale and Forfeiture
Before Effectivity of Code. - Tax delinquencies incurred, and sales
and forfeitures of delinquent real property effected, before the
effectivity
of this Code shall be governed by the provisions of applicable laws
then
in force.
TITLE III. - SHARES OF
LOCAL
GOVERNMENT UNITS IN THE PROCEEDS OF NATIONAL TAXESCHAPTER 1 - ALLOTMENT
OF
INTERNAL REVENUESEC. 284. Allotment of
Internal
Revenue Taxes. - Local government units shall have a share in the
national
internal revenue taxes based on the collection of the third fiscal year
preceding the current fiscal year as follows:chanroblesvirtuallawlibrary
(a) On the first year
of the effectivity of this Code, thirty percent (30%);
(b) On the second year,
thirty-five percent (35%); and cralaw:red
(c) On the third year
and thereafter, forty percent (40%). Provided, That in the event that
the
national government incurs an unmanageable public sector deficit, the
President
of the Philippines is hereby authorized, upon the recommendation of
Secretary
of Finance, Secretary of Interior and Local Government and Secretary of
Budget and Management, and subject to consultation with the presiding
officers
of both Houses of Congress and the presidents of the liga, to make the
necessary adjustments in the internal revenue allotment of local
government
units but in no case shall the allotment be less than thirty percent
(30%)
of the collection of national internal revenue taxes of the third
fiscal
year preceding the current fiscal year: Provided, further That in the
first
year of the effectivity of this Code, the local government units shall,
in addition to the thirty percent (30%) internal revenue allotment
which
shall include the cost of devolved functions for essential public
services,
be entitled to receive the amount equivalent to the cost of devolved
personal
services.cralaw:red
SEC. 285. Allocation to
Local Government Units. - The share of local government units in
the
internal revenue allotment shall be allocated in the following manner:chanrobles virtual law library
(a) Provinces - Twenty-three
percent (23%);
(b) Cities - Twenty-three
percent (23%);
(c) Municipalities
- Thirty-four percent (34%); and cralaw:red
(d) barangays - Twenty
percent (20%) Provided, however, That the share of each province, city,
and municipality shall be determined on the basis of the following
formula:chanrobles virtual law library
(a) Population - Fifty
percent (50%);
(b) Land Area - Twenty-five
percent (25%); and cralaw:red
(c) Equal sharing -
Twenty-five percent (25%) Provided, further, That the share of each
barangay
with a population of not less than one hundred (100) inhabitants shall
not be less than Eighty thousand pesos (P=80,000.00) per annum
chargeable
against the twenty percent (20%) share of the barangay from the
internal
revenue allotment, and the balance to be allocated on the basis of the
following formula:chanrobles virtual law library
(a) On the first year
of the effectivity of this Code:chanrobles virtual law library
(1) Population - Forty percent
(40%); and cralaw:red
(2) Equal Sharing -
Sixty percent (60%)
(b) On the second year:chanrobles virtual law library
(1) Population - Fifty
percent (50%); and cralaw:red
(2) Equal Sharing -
Fifty percent (50%)
(c) On the third year
and thereafter:chanrobles virtual law library
(1) Population - Sixty
percent (60%); and cralaw:red
(2) Equal Sharing - Forty
percent (40%). Provided, finally, That the financial requirements of
barangays
created by local government units after the effectivity of this Code
shall
be the responsibility of the local government unit concerned.cralaw:red
SEC. 286. Automatic Release
of Shares. - (a) The share of each local government unit shall be
released,
without need of any further action, directly to the provincial, city,
municipal
or barangay treasurer, as the case may be, on a quarterly basis within
five (5) days after the end of each quarter, and which shall not be
subject
to any lien or holdback that may be imposed by the national government
for whatever purpose.cralaw:red
(b) Nothing in this
Chapter shall be understood to diminish the share of local government
units
under existing laws.cralaw:red
SEC. 287. Local Development
Projects. - Each local government unit shall appropriate in its
annual
budget no less than twenty percent (20%) of its annual internal revenue
allotment for development projects. Copies of the development plans of
local government units shall be furnished the Department of Interior
and
Local Government.cralaw:red
SEC. 288. Rules and Regulations.
- The Secretary of Finance, in consultation with the Secretary of
Budget
and Management, shall promulgate the necessary rules and regulations
for
a simplified disbursement scheme designed for the speedy and effective
enforcement of the provisions of this Chapter.
CHAPTER 2 - SHARE
OF LOCAL
GOVERNMENT UNITS IN THE NATIONAL WEALTHSEC. 289. Share in the
Proceeds
from the Development and Utilization of the National Wealth. -
Local
government units shall have an equitable share in the proceeds derived
from the utilization and development of the national wealth within
their
respective areas, including sharing the same with the inhabitants by
way
of direct benefits.
SEC. 290. Amount of Share
of Local Government Units. - Local government units shall, in
addition
to the internal revenue allotment, have a share of forty percent (40%)
of the gross collection derived by the national government from the
preceding
fiscal year from mining taxes, royalties, forestry and fishery charges,
and such other taxes, fees, or charges, including related surcharges,
interests,
or fines, and from its share in any co-production, joint venture or
production
sharing agreement in the utilization and development of the national
wealth
within their territorial jurisdiction.cralaw:red
SEC. 291Share of the
Local Governments from any Government Agency or -Owned and -Controlled
Corporation. - Local government units shall have a share based on
the
preceding fiscal year from the proceeds derived by any government
agency
or government-owned or -controlled corporation engaged in the
utilization
and development of the national wealth based on the following formula
whichever
will produce a higher share for the local government unit:chanrobles virtual law library
(a) One percent (1%)
of the gross sales or receipts of the preceding calendar year; or
(b) Forty percent (40%)
of the mining taxes, royalties, forestry and fishery charges and such
other
taxes, fees or charges, including related surcharges, interests, or
fines
the government agency or government -owned or -controlled corporation
would
have paid if it were not otherwise exempt.cralaw:red
SEC. 292. Allocation of
Shares. - The share in the preceding Section shall be distributed
in
the following manner:chanrobles virtual law library
(a) Where the natural
resources are located in the province
(1) province - Twenty percent
(20%);
(2) Component city/municipality
- Forty-five percent (45%); and cralaw:red
(3) barangay - Thirty-five
percent (35%) Provided, however, That where the natural resources are
located
in two (2) or more provinces, or in two (2) or more component cities or
municipalities or in two (2) or more barangays, their respective shares
shall be computed on the basis of:chanrobles virtual law library
(1) Population - Seventy
percent (70%); and cralaw:red
(2) Land area - Thirty
percent (30%).cralaw:red
(b) Where the natural
resources are located in a highly urbanized or independent component
city:chanrobles virtual law library
(1) city - Sixty-five
percent (65%); and cralaw:red
(2) barangay - Thirty-five
percent (35%) Provided, however, That where the natural resources are
located
in such two (2) or more cities, the allocation of shares shall be based
on the formula on population and land area as specified in paragraph
(a)
of this Section.cralaw:red
SEC. 293 Remittance of
the Share of Local Government Units. - The share of local
government
units from the utilization and development of national wealth shall be
remitted in accordance with Section 286 of this Code: Provided,
however,
That in the case of any government agency or government-owned or
-controlled
corporation engaged in the utilization and development of the national
wealth, such share shall be directly remitted to the provincial, city,
municipal or barangay treasurer concerned within five (5) days after
the
end of each quarter.cralaw:red
SEC. 294. Development
and Livelihood Projects. - The proceeds from the share of local
government
units pursuant to this chapter shall be appropriated by their
respective
sanggunian to finance local development and livelihood projects:
Provided,
however, That at least eighty percent (80%) of the proceeds derived
from
the development and utilization of hydrothermal, geothermal, and other
sources of energy shall be applied solely to lower the cost of
electricity
in the local government unit where such a source of energy is located.
TITLE IV. - CREDIT
FINANCINGSEC. 295. Scope. -
This
Title shall govern the power of local government units to create
indebtedness
and to enter into credit and other financial transactions.
SEC. 296. General Policy.
- (a) It shall be the basic policy that any local government unit may
create
indebtedness, and avail of credit facilities to finance local
infrastructure
and other socio-economic development projects in accordance with the
approved
local development plan and public investment program.cralaw:red
(b) A local government
unit may avail of credit lines from government or private banks and
lending
institutions for the purpose of stabilizing local finances.cralaw:red
SEC. 297. Loans, Credits,
and Other Forms of Indebted ness of Local Government Units. - (a) A
local government unit may contract loans, credits, and other forms of
indebtedness
with any government or domestic private bank and other lending
institutions
to finance the construction, installation, improvement, expansion,
operation,
or maintenance of public facilities, infrastructure facilities, housing
projects, the acquisition of real property, and the implementation of
other
capital investment projects, subject to such terms and conditions as
may
be agreed upon by the local government unit and the lender. The
proceeds
from such transactions shall accrue directly to the local government
unit
concerned.cralaw:red
(b) A local government
unit may likewise secure from any government bank and lending
institution
short, medium and long-term loans and advances against security of real
estate or other acceptable assets for the establishment, development,
or
expansion of agricultural, industrial, commercial, house financing
projects,
livelihood projects, and other economic enterprises.cralaw:red
(c) Government financial
and other lending institutions are hereby authorized to grant loans,
credits,
and other forms of indebtedness out of their loanable funds to local
government
units for purposes specified above.cralaw:red
SEC. 298. Deferred-Payment
and other Financial Schemes. - Provincial, city and municipal
governments
may likewise acquire property, plant, machinery, equipment, and such
necessary
accessories under a supplier's credit, deferred payment plan, or other
financial scheme.cralaw:red
SEC. 299. Bonds and Other
Long-Term Securities. - Subject to the rules and regulations of the
Central Bank and the Securities and Exchange Commission, provinces,
cities,
and municipalities are hereby authorized to issue bonds, debentures,
securities,
collaterals, notes and other obligations to finance self-liquidating,
income-producing
development or livelihood projects pursuant to the priorities
established
in the approved local development plan or the public investment
program.
The sanggunian concerned shall, through an ordinance approved by a
majority
of all its members, declare and state the terms and conditions of the
bonds
and the purpose for which the proposed indebtedness is to be incurred.cralaw:red
SEC. 300. Inter-Local
Government Loans, Grants, and Subsidies. - provinces, cities and
municipalities
may, upon approval of the majority of all members of the sanggunian
concerned
and in amounts not exceeding their surplus funds, extend loans, grants,
or subsidies to other local government units under such terms and
conditions
as may be agreed upon by the contracting parties. Local government
units
may, upon approval of their respective sanggunian, jointly or severally
contract loans, credits, and other forms of indebtedness for purposes
mutually
beneficial to them.cralaw:red
SEC. 301. Loans from Funds
Secured by the National Government from Foreign Sources. - (a) The
President, or his duly authorized representative, may, through any
government
financial or other lending institution, relend to any province, city,
municipality,
or barangay, the proceeds of loans contracted with foreign financial
institutions
or other international funding agencies for the purpose of financing
the
construction, installation, improvement, expansion, operation, or
maintenance
of public utilities and facilities, infrastructure facilities, or
housing
projects, the acquisition of real property, and the implementation of
other
capital investment projects, subject to such terms and conditions as
may
be agreed upon by the President and the local government unit. The
proceeds
from such loans shall accrue directly to the local government concerned.cralaw:red
(b) The President may
likewise authorize the relending to local government units the proceeds
of grants secured from foreign sources, subject to the provisions of
existing
laws and the applicable grant agreements.cralaw:red
(c) Repayment or amortization
of loans including accrued interest thereon, may be financed partly
from
the income of the projects or services and from the regular income of
the
local government unit, which must be provided for and appropriated
regularly
in its annual budget until the loan and the interest thereon shall have
been fully paid.cralaw:red
SEC. 302. Financing, Construction,
Maintenance, Operation, and Management of Infrastructure Projects by
the
Private Sector. - (a) Local government units may enter into
contracts
with any duly prequalified individual contractor, for the financing,
construction,
operation, and maintenance of any financially viable infrastructure
facilities,
under the build-operate-and-transfer agreement, subject to the
applicable
provisions of Republic Act Numbered Sixty-nine hundred fifty-seven
(R.A.
No. 6957) authorizing the financing, construction, operation and
maintenance
of infrastructure projects by the private sector and the rules and
regulations
issued thereunder and such terms and conditions provided in this
Section.cralaw:red
(b) Local government
units shall include in their respective local development plans and
public
investment programs priority projects that may be financed,
constructed,
operated and maintained by the private sector under this Section. It
shall
be the duty of the local government unit concerned to disclose to the
public
all projects eligible for financing under this Section, including
official
notification of duly registered contractors and publication in
newspapers
of general or local circulation and in conspicuous and accessible
public
places. Local projects under the build-operate-and-transfer agreement
shall
be confirmed by the local development councils.cralaw:red
(c) Projects implemented
under this Section shall be subject to the following terms and
conditions:chanrobles virtual law library
(1) The provincial,
city, or municipal engineer, as the case may be, upon formal request in
writing by the local chief executive, shall prepare the plans and
specifications
for the proposed project, which shall be submitted to the sanggunian
for
approval.cralaw:red
(2) Upon approval by
the sanggunian of the project plans and specifications, the provincial,
city, or municipal engineer shall, as the case may be, cause to be
published
once every week for two (2) consecutive weeks in at least one (1) local
newspaper which is circulated in the region, province, city or
municipality
in which the project is to be implemented, a notice inviting all duly
qualified
contractors to participate in a public bidding for the projects so
approved.
The conduct of public bidding and award of contracts for local
government
projects under this Section shall be in accordance with this Code and
other
applicable laws, rules and regulations.cralaw:red
In the case of a build-operate-and-transfer
agreement, the contract shall be awarded to the lowest complying bidder
whose offer is deemed most advantageous to the local government and
based
on the present value of its proposed tolls, fees, rentals, and charges
over a fixed term for the facility to be constructed, operated, and
maintained
according to the prescribed minimum design and performance standards,
plans,
and specifications. For this purpose, the winning contractor shall be
automatically
granted by the local government unit concerned the franchise to operate
and maintain the facility, including the collection of tolls, fees,
rentals,
and charges in accordance with subsection (c-4) hereof.cralaw:red
In the case of a build-operate-and-transfer
agreement, the contract shall be awarded to the lowest complying bidder
based on the present value of its proposed schedule of amortization
payments
for the facility to be constructed according to the prescribed minimum
design and performance standards, plans, and specifications.cralaw:red
(3) Any contractor
who shall undertake the prosecution of any project under this Section
shall
post the required bonds to protect the interest of the province, city,
or municipality, in such amounts as may be fixed by the sanggunian
concerned
and the provincial, city, or municipal engineer shall not, as the case
may be, allow any contractor to initiate the prosecution of projects
under
this Section unless such contractor presents proof or evidence that he
has posted the required bond.cralaw:red
(4) The contractor
shall be entitled to a reasonable return of its investment in
accordance
with its bid proposal as accepted by the local government unit
concerned.
In the case of a build-operate-and-transfer agreement, the repayment
shall
be made by authorizing the contractor to charge and collect reasonable
tolls, fees, rentals, and charges for the use of the project facility
not
exceeding those proposed in the bid and incorporated in the contract:
Provided,
That the local government unit concerned shall, based on reasonableness
and equity, approve the tolls, fees, rentals and charges: Provided,
further,
That the imposition and collection of tolls, fees, rentals and charges
shall be for a fixed period as proposed in the bid and incorporated in
the contract which shall in no case exceed fifty (50) years: Provided,
finally, That during the lifetime of the contract, the contractor shall
undertake the necessary maintenance and repair of the facility in
accordance
with standards prescribed in the bidding documents and in the contract.
In the case of a build-operate-and-transfer agreement, the repayment
shall
be made through amortization payments in accordance with the schedule
proposed
in the bid and incorporated in the contract. In case of land
reclamation
or construction of industrial estates, the repayment plan may consist
of
the grant of a portion or percentage of the reclaimed land or the
industrial
estate constructed.cralaw:red
(5) Every infrastructure
project undertaken under this Section shall be constructed, operated,
and
maintained by the contractor under the technical supervision of the
local
government unit and in accordance with the plans, specifications,
standards,
and costs approved by it.cralaw:red
(d) The provincial,
city or municipal legal officer shall, as the case may be, review the
contracts
executed pursuant to this Section to determine their legality,
validity,
enforceability and correctness of form.cralaw:red
SEC. 303. Remedies and
Sanctions. - Local government units shall appropriate in their
respective
annual budgets such amounts as are sufficient to pay the loans and
other
indebtedness incurred or redeem or retire bonds, debentures,
securities,
notes and other obligations issued under this Title: Provided, That
failure
to provide the appropriations herein required shall render their annual
budgets inoperative.
TITLE FIVE. - LOCAL
FISCAL ADMINISTRATIONCHAPTER 1 - GENERAL
PROVISIONSSEC. 304. Scope. -
This
Title shall govern the conduct and management of financial affairs,
transactions,
and operations of provinces, cities, municipalities, and barangays.
SEC. 305. Fundamental
Principles. - The financial affairs, transactions, and operations
of
local government units shall be governed by the following fundamental
principles:chanrobles virtual law library
(a) No money shall be paid
out of the local treasury except in pursuance of an appropriations
ordinance
or law;
(b) Local government
funds and monies shall be spent solely for public purposes;
(c) Local revenue is
generated only from sources expressly authorized by law or ordinance,
and
collection thereof shall at all times be acknowledged properly;
(d) All monies officially
received by a local government officer in any capacity or on any
occasion
shall be accounted for as local funds, unless otherwise provided by law;
(e) Trust funds in
the local treasury shall not be paid out except in fulfillment of the
purpose
for which the trust was created or the funds received;
(f) Every officer of
the local government unit whose duties permit or require the possession
or custody of local funds shall be properly bonded, and such officer
shall
be accountable and responsible for said funds and for the safekeeping
thereof
in conformity with the provisions of law;
(g) Local governments
shall formulate sound financial plans, and the local budgets shall be
based
on functions, activities, and projects, in terms of expected results;
pment
plans, goals, and strategies in order to optimize the utilization of
resources
and to avoid duplication in the use of fiscal and physical resources;
(i) Local budgets shall
operationalize approved local development plans;
(j) Local government units
shall ensure that their respective budgets incorporate the requirements
of their component units and provide for equitable allocation of
resources
among these component units;
(k) National planning
shall be based on local planning to ensure that the needs and
aspirations
of the people as articulated by the local government units in their
respective
local development plans are considered in the formulation of budgets of
national line agencies or offices;
(l) Fiscal responsibility
shall be shared by all those exercising authority over the financial
affairs,
transactions, and operations of the local government units; and cralaw:red
(m) The local government
unit shall endeavor to have a balanced budget in each fiscal year of
operation.cralaw:red
SEC. 306. Definitions.
- When used in this Title, the term - (a) "Annual Budget" refers to a
financial
plan embodying the estimates of income and expenditures for one (1)
fiscal
year;
(b) "Appropriation"
refers to an authorization made by ordinance, directing the payment of
goods and services from local government funds under specified
conditions
or for specific purposes;
(c) "Budget Document"
refers to the instrument used by the local chief executive to present a
comprehensive financial plan to the sanggunian concerned;
(d) "Capital Outlays"
refers to appropriations for the purchase of goods and services, the
benefits
of which extend beyond the fiscal year and which add to the assets of
the
local government unit concerned, including investments in public
utilities
such as public markets and slaughterhouses;
(e) "Continuing Appropriation"
refers to an appropriation available to support obligations for a
specified
purpose or projects, such as those for the construction of physical
structures
or for the acquisition of real property or equipment, even when these
obligations
are incurred beyond the budget year;
(f) "Current Operating
Expenditures" refers to appropriations for the purchase of goods and
services
for the conduct of normal local government operations within the fiscal
year, including goods and services that will be used or consumed during
the budget year;
(g) "Expected Results"
refers to the services, products, or benefits that will accrue to the
public,
estimated in terms of performance measures or physical targets;
(h) "Fund" refers to
a sum of money, or other assets convertible to cash, set aside for the
purpose of carrying out specific activities or attaining certain
objectives
in accordance with special regulations, restrictions, or limitations,
and
constitutes an independent fiscal and accounting entity;
(i) "Income" refers
to all revenues and receipts collected or received forming the gross
accretions
of funds of the local government unit;
(j) "Obligations" refers
to an amount committed to be paid by the local government unit for any
lawful act made by an accountable officer for and in behalf of the
local
unit concerned;
(k) "Personal Services"
refers to appropriations for the payment of salaries, wages and other
compensation
of permanent, temporary, contractual, and casual employees of the local
government unit;
(l) "Receipts" refers
to income realized from operations and activities of the local
government
or are received by it in the exercise of its corporate functions,
consisting
of charges for services rendered, conveniences furnished, or the price
of a commodity sold, as well as loans, contributions or aids from other
entities, except provisional advances for budgetary purposes; and cralaw:red
(m) "Revenue" refers
to income derived from the regular system of taxation enforced under
authority
of law or ordinance, and, as such, accrue more or less regularly every
year.
CHAPTER 2 - LOCAL
AND OTHER
SPECIAL FUNDSArticle One. -
Receipts, Safekeeping
and Disposition of Local FundsSEC. 307. Remittance
of Government
Monies to the Local Treasury. - Officers of the local government
authorized
to receive and collect monies arising from taxes, revenues, or receipts
of any kind shall remit the full amount received and collected to the
treasury
of such local government unit which shall be credited to the particular
account or accounts to which the monies in question properly belong.
SEC. 308. Local Funds.
- Every local government unit shall maintain a General Fund which shall
be used to account for such monies and resources as may be received by
and disbursed from the local treasury. The General Fund shall consist
of
monies and resources of the local government which are available for
the
payment of expenditures, obligations or purposes not specifically
declared
by law as accruing and chargeable to, or payable from, any other fund.cralaw:red
SEC. 309. Special Funds.
- There shall be maintained in every provincial, city, or municipal
treasury
the following special funds:chanrobles virtual law library
(a) Special Education
Fund (SEF) shall consist of the respective shares of provinces, cities,
municipalities and barangays in the proceeds of the additional tax on
real
property to be appropriated for purposes prescribed in Section 272 of
this
Code; and cralaw:red
(b) Trust Funds shall
consist of private and public monies which have officially come into
the
possession of the local government or of a local government official as
trustee, agent or administrator, or which have been received as a
guaranty
for the fulfillment of some obligation. A trust fund shall only be used
for the specific purpose for which it was created or for which it came
into the possession of the local government unit.cralaw:red
SEC. 310. Separation of
Books and Depository Accounts. - Local accountants and treasurers
shall
maintain separate books and depository accounts, respectively, for each
fund in their custody or administration under such rules and
regulations
as the Commission on Audit may prescribe.cralaw:red
SEC. 311. Depository Accounts.
- Local treasurers shall maintain depository accounts in the name of
their
respective local government units with banks, preferably
government-owned,
located in or nearest to their respective areas of jurisdiction.
Earnings
of each depository account shall accrue exclusively thereto.cralaw:red
SEC. 312. Separation of
Personal Money from Public Funds. - Local treasurers and other
accountable
officers shall keep personal monies separate and distinct from local
public
funds in their custody and shall not make profit out of public money or
otherwise apply the same to any use not authorized by law or ordinance.
Article Two. - Special
AccountsSEC. 313. Special
Accounts
to be Maintained in the General Fund. - Local government units
shall
maintain special accounts in the general fund for the following:chanroblesvirtuallawlibrary
(a) Public utilities
and other economic enterprises;
(b) Loans, interests,
bond issues, and other contributions for specific purposes; and cralaw:red
(c) Development projects
funded from the share of the local government unit concerned in the
internal
revenue allotment and such other special accounts which may be created
by law or ordinance. Receipts, transfers, and expenditures involving
the
foregoing special accounts shall be properly taken up thereunder.
Profits
or income derived from the operation of public utilities and other
economic
enterprises, after deduction for the cost of improvement, repair and
other
related expenses of the public utility or economic enterprise
concerned,
shall first be applied for the return of the advances or loans made
therefor.
Any excess shall form part of the general fund of the local government
unit concerned.
CHAPTER 3. - BUDGETINGArticle One. - Local
Government
BudgetsSEC. 314. Form and
Content.
- (a) Local government budgets shall primarily consist of two (2) parts:chanroblesvirtuallawlibrary
(1) The estimates of income; and cralaw:red
(2) The total appropriations
covering the current operating expenditures and capital outlays.cralaw:red
(b) The budget document
shall contain:chanrobles virtual law library
(1) A budget message
of the local chief executive setting forth in brief the significance of
the executive budget, particularly in relation to the approved local
development
plan;
(2) A brief summary
of the functions, projects, and activities to be accomplished in
pursuit
of the goals and objectives of the local government unit for the
ensuing
fiscal year, specifically the delivery of basic services or facilities
enumerated under Section 17 of this Code;
(3) Summary of financial
statements setting forth:chanrobles virtual law library
(i) The actual income
and expenditures during the immediately preceding year; (ii) The actual
income and expenditures of the first two (2) quarters and the estimates
of income and expenditures for the last two (2) quarters of the current
fiscal year;
(iii) The estimates
of income for the ensuing fiscal year from ordinances and laws existing
at the time the proposed budget is transmitted, together with other
revenue-raising
proposals;
(iv) The estimated
expenditures necessary to carry out the functions, projects, and
activities
of the local government unit for the ensuing fiscal year;
(v) All essential facts
regarding the bonded and other long-term obligations and indebtedness
of
the local government unit, if any;
(vi) Summary statement of
all statutory and contractual obligations due; and cralaw:red
(vii) Such other financial
statements and data as are deemed necessary or desirable in order to
disclose
in all practicable detail the financial condition of the local
government
unit.cralaw:red
SEC. 315. Submission of
Detailed Statements of Income and Expenditures. - (a) On or before
the fifteenth (15th) day of July of each year, local treasurers shall
submit
to their respective local chief executives a certified statement
covering
the income and expenditures of the preceding fiscal year, the actual
income
and expenditures of the first two (2) quarters of the current year, and
the estimated income and expenditures for the last two (2) quarters of
the current year.cralaw:red
SEC. 316. Local Finance
Committee. - There is hereby created in every province, city, or
municipality
a local finance committee to be composed of the local planning and
development
officer, the local budget officer, and the local treasurer. It shall
exercise
the following functions:chanrobles virtual law library
(a) Determine the income
reasonably projected as collectible for the ensuing fiscal year;
(b) Recommend the appropriate
tax and other revenue measures or borrowings which may be appropriate
to
support the budget;
(c) Recommend to the
local chief executive concerned the level of the annual expenditures
and
the ceilings of spending for economic, social, and general services
based
on the approved local development plans;
(d) Recommend to the
local chief executive concerned the proper allocation of expenditures
for
each development activity between current operating expenditures and
capital
outlays;
(e) Recommend to the
local chief executive concerned the amount to be allocated for capital
outlay under each development activity or infrastructure project;
(f) Assist the sangguniang
panlalawigan in the review and evaluation of budget of component cities
and municipalities in the case of provincial finance committee, the
barangay
budgets in the case of city or municipal finance committee, and
recommend
the appropriate action thereon;
(g) Assist the sanggunian
concerned in the analysis and review of annual regular and supplemental
budgets of the respective local government unit to determine compliance
with statutory and administrative requirements; and cralaw:red
(h) Conduct semi-annual
review and general examination of cost and accomplishments against
performance
standards applied in undertaking development projects. A copy of this
report
shall be furnished the local chief executive and the sanggunian
concerned,
and shall be posted in conspicuous and publicly accessible places in
the
provinces, cities, municipalities and barangays.cralaw:red
SEC. 317. Submission of
Budget Proposals by Heads of Departments or Offices. - (a) Each
head
of department or office shall submit a budget proposal for his
department
or office to the local chief executive on or before the fifteenth
(15th)
of July of each year: Provided, That the budget proposal of each
department
or office shall be categorized under either economic, social or general
services: Provided, further, That each service shall be covered by the
budget of at least one (1) department or office of the local government
unit concerned. The said budget proposal shall be prepared in
accordance
with such policy and program guidelines as the local chief executive
concerned
may issue in conformity with the local development plan, the budgetary
ceilings prescribed by the local finance committee, and the general
requirements
prescribed in this Title.cralaw:red
(b) Budget proposals
of departments or offices shall be divided into two (2) primary
categories,
namely: the current operating expenditures and the capital outlays.
Such
budget proposals shall contain the following information:chanrobles virtual law library
(1) Objectives, functions,
and projects showing the general character and relative importance of
the
work to be accomplished or the services to be rendered, and the cost
thereof;
(2) Organizational
charts and staffing patterns indicating the list of plantilla positions
with their corresponding salaries, and proposals for reclassification
of
positions and salary changes, as well as the creation of new positions
with their proposed salary grade, duly supported by proper
justification;
(3) Brief description of
the functions, projects and activities for the ensuing fiscal year,
expected
results for each function, project and activity, and the nature of work
to be performed, including the objects of expenditure for each
function,
project and activity;
(4) Relation of the
work and financial proposals to approved local development plans;
(5) Estimated current
operating expenditures and capital outlays with comparative data for
the
last two (2) preceding, current, and ensuing fiscal years; and cralaw:red
(6) Accomplishment
reports for the last two (2) preceding and current fiscal years.cralaw:red
SEC. 318. Preparation
of the Budget by the Local Chief Executive. - Upon receipt of the
statements
of income and expenditures from the treasurer, the budget proposals of
the heads of departments and offices, and the estimates of income and
budgetary
ceilings from the local finance committee, the local chief executive
shall
prepare the executive budget for the ensuing fiscal year in accordance
with the provisions of this Title. The local chief executive shall
submit
the said executive budget to the sanggunian concerned not later than
the
sixteenth (16th) of October of the current fiscal year. Failure to
submit
such budget on the date prescribed herein shall subject the local chief
executive to such criminal and administrative penalties as provided for
under this Code and other applicable laws.cralaw:red
SEC. 319. Legislative
Authorization of the Budget. - On or before the end of the current
fiscal year, the sanggunian concerned shall enact, through an
ordinance,
the annual budget of the local government unit for the ensuing fiscal
year
on the basis of the estimates of income and expenditures submitted by
the
local chief executive.cralaw:red
SEC. 320. Effectivity
of Budgets. - The ordinance enacting the annual budget shall take
effect
at the beginning of the ensuing calendar year. An ordinance enacting a
supplemental budget, however, shall take effect upon its approval or on
the date fixed therein. The responsibility for the execution of the
annual
and supplemental budgets and the accountability therefor shall be
vested
primarily in the local chief executive concerned.cralaw:red
SEC. 321. Changes in the
Annual Budget. - All budgetary proposals shall be included and
considered
in the budget preparation process. After the local chief executive
concerned
shall have submitted the executive budget to the sanggunian, no
ordinance
providing for a supplemental budget shall be enacted, except when
supported
by funds actually available as certified by the local treasurer or by
new
revenue sources.cralaw:red
A supplemental budget
may also be enacted in times of public calamity by way of budgetary
realignment
to set aside appropriations for the purchase of supplies and materials
or the payment of services which are exceptionally urgent or absolutely
indispensable to prevent imminent danger to, or loss of, life or
property,
in the jurisdiction of the local government unit or in other areas
declared
by the President in a state of calamity. Such ordinance shall clearly
indicate
the sources of funds available for appropriations, as certified under
oath
by the local treasurer and local accountant and attested by the local
chief
executive, and the various items of appropriations affected and the
reasons
for the change.cralaw:red
SEC. 322. Reversion of
Unexpended Balances of Appropriations, Continuing Appropriations. -
Unexpended balances of appropriations authorized in the annual
appropriations
ordinance shall revert to the unappropriated surplus of the general
fund
at the end of the fiscal year and shall not thereafter be available for
expenditure except by subsequent enactment. However, appropriations for
capital outlays shall continue and remain valid until fully spent,
reverted
or the project is completed. Reversions of continuing appropriations
shall
not be allowed unless obligations therefor have been fully paid or
otherwise
settled. The balances of continuing appropriations shall be reviewed as
part of the annual budget preparation and the sanggunian concerned may
approve, upon recommendation of the local chief executive, the
reversion
of funds no longer needed in connection with the activities funded by
said
continuing appropriations subject to the provisions of this Section.cralaw:red
SEC. 323. Failure to Enact
the Annual Appropriations. - In case the sanggunian concerned fails
to pass the ordinance authorizing the annual appropriations at the
beginning
of the ensuing fiscal year, it shall continue to hold sessions, without
additional remuneration for its members, until such ordinance is
approved,
and no other business may be taken up during such sessions. If the
sanggunian
still fails to enact such ordinance after ninety (90) days from the
beginning
of the fiscal year, the ordinance authorizing the appropriations of the
preceding year shall be deemed reenacted and shall remain in force and
effect until the ordinance authorizing the proposed appropriations is
passed
by the sanggunian concerned. However, only the annual appropriations
for
salaries and wages of existing positions, statutory and contractual
obligations,
and essential operating expenses authorized in the annual and
supplemental
budgets for the preceding year shall be deemed reenacted and
disbursement
of funds shall be in accordance therewith. In the implementation of
such
reenacted ordinance, the local treasurer concerned shall exclude from
the
estimates of income for the preceding fiscal year those realized from
nonrecurring
sources, like national aids, proceeds from loans, sale of assets, prior
year adjustments, and other analogous sources of income. No ordinance
authorizing
supplemental appropriations shall be passed in place of the annual
appropriations.
In case the revised income estimates be less than the aggregate
reenacted
appropriations, the local treasurer concerned shall accordingly advise
the sanggunian concerned which shall, within ten (10) days from the
receipt
of such advice, make the necessary adjustments or reductions. The
revised
appropriations authorized by the sanggunian concerned shall then be the
basis for disbursements.cralaw:red
SEC. 324. Budgetary Requirements.
- The budgets of local government units for any fiscal year shall
comply
with the following requirements: (a) The aggregate amount appropriated
shall not exceed the estimates of income;
(b) Full provision
shall be made for all statutory and contractual obligations of the
local
government unit concerned: Provided, however, That the amount of
appropriations
for debt servicing shall not exceed twenty percent (20%) of the regular
income of the local government unit concerned;
(c) In the case of provinces,
cities, and municipalities, aid to component barangays shall be
provided
in amounts of not less than One thousand pesos (P=1,000.00) per
barangay; and cralaw:red
(d) Five percent (5%)
of the estimated revenue from regular sources shall be set aside as an
annual lump sum appropriation for unforeseen expenditures arising from
the occurrence of calamities: Provided, however, That such
appropriation
shall be used only in the area, or a portion thereof, of the local
government
unit or other areas declared by the President in a state of calamity.cralaw:red
SEC. 325. General Limitations.
- The use of the provincial, city, and municipal funds shall be subject
to the following limitations:chanrobles virtual law library
(a) The total appropriations,
whether annual or supplemental, for personal services of a local
government
unit for one (1) fiscal year shall not exceed forty-five percent (45%)
in the case of first to third class provinces, cities, and
municipalities,
and fifty-five percent (55%) in the case of fourth class or lower, of
the
total annual income from regular sources realized in the next preceding
fiscal year. The appropriations for salaries, wages, representation and
transportation allowances of officials and employees of the public
utilities
and economic enterprises owned, operated, and maintained by the local
government
unit concerned shall not be included in the annual budget or in the
computation
of the maximum amount for personal services. The appropriations for the
personal services of such economic enterprises shall be charged to
their
respective budgets;
(b) No official or employee
shall be entitled to a salary rate higher than the maximum fixed for
his
position or other positions of equivalent rank by applicable laws or
rules
and regulations issued thereunder;
(c) No local fund shall
be appropriated to increase or adjust salaries or wages of officials
and
employees of the national government, except as may be expressly
authorized
by law; (d) In cases of abolition of positions and the creation of new
ones resulting from the abolition of existing positions in the career
service,
such abolition or creation shall be made in accordance with pertinent
provisions
of this code and the civil service law, rules and regulations;
(e) Positions in the
official plantilla for career positions which are occupied by
incumbents
holding permanent appointments shall be covered by adequate
appropriations;
(f) No changes in designation
or nomenclature of positions resulting in a promotion or demotion in
rank
or increase or decrease in compensation shall be allowed, except when
the
position is actually vacant, and the filling of such positions shall be
strictly made in accordance with the civil service law, rules and
regulations;
(g) The creation of new positions and salary increases or adjustments
shall
in no case be made retroactive; and cralaw:red
(h) The annual appropriations
for discretionary purposes of the local chief executive shall not
exceed
two percent (2%) of the actual receipts derived from basic real
property
tax in the next preceding calendar year. Discretionary funds shall be
disbursed
only for public purposes to be supported by appropriate vouchers and
subject
to such guidelines as may be prescribed by law. No amount shall be
appropriated
for the same purpose except as authorized under this Section.cralaw:red
SEC. 326. Review of Appropriation
Ordinances of provinces, Highly-Urbanized Cities, Independent Component
Cities, and Municipalities within the Metropolitan Manila Area. -
The
Department of Budget and Management shall review ordinances authorizing
the annual or supplemental appropriations of provinces,
highly-urbanized
cities, independent component cities, and municipalities within the
Metropolitan
Manila Area in accordance with the immediately succeeding Section.cralaw:red
SEC. 327. Review of Appropriation
Ordinances of Component Cities and Municipalities. - The
sangguniang
panlalawigan shall review the ordinance authorizing annual or
supplemental
appropriations of component cities and municipalities in the same
manner
and within the same period prescribed for the review of other
ordinances.
If within ninety (90) days from receipt of copies of such ordinance,
the
sangguniang panlalawigan takes no action thereon, the same shall be
deemed
to have been reviewed in accordance with law and shall continue to be
in
full force and effect. If within the same period, the sangguniang
panlalawigan
shall have ascertained that the ordinance authorizing annual or
supplemental
appropriations has not complied with the requirements set forth in this
Title, the sangguniang panlalawigan shall, within the ninety-day period
hereinabove prescribed, declare such ordinance inoperative in its
entirety
or in part. Items of appropriation contrary to limitations prescribed
in
this Title or in excess of the amounts prescribed herein shall be
disallowed
or reduced accordingly. The sangguniang panlalawigan shall within the
same
period advise the sangguniang panlungsod or sangguniang bayan concerned
through the local chief executive of any action on the ordinance under
review. Upon receipt of such advice, the city or municipal treasurer
concerned
shall not make further disbursements of funds from any of the items of
appropriation declared inoperative, disallowed or reduced.cralaw:red
SEC. 328. Duration of
Appropriation. - Appropriations for ordinary administrative
purposes
not duly obligated shall terminate with the fiscal year and all
unexpended
balances thereof shall be automatically reverted on the thirty-first
(31st)
day of December of each year to the general fund of the local
government
unit.
Article Two. -
Barangay BudgetsSEC. 329. Barangay
Funds.
- Unless otherwise provided in this Title, all the income of the
barangay
from whatever source shall accrue to its general fund and shall, at the
option of the barangay concerned, be kept as trust fund in the custody
of the city or municipal treasurer or be deposited in a bank,
preferably
government-owned, situated in or nearest to its area of jurisdiction.
Such
funds shall be disbursed in accordance with the provisions of this
Title.
Ten percent (10%) of the general fund of the barangay shall be set
aside
for the sangguniang kabataan.
SEC. 330. Submission of
Detailed Statements of Income and Expenditures for the Barangay Budgets.
- On or before the fifteenth (15th) day of September of each year, the
barangay treasurer shall submit to the punong barangay a statement
covering
the estimates of income and expenditures for the ensuing fiscal year,
based
on a certified statement issued by the city or municipal treasurer
covering
the estimates of income from local sources for the barangay concerned.cralaw:red
SEC. 331. Preparation of
the Barangay Budget. - (a) Upon receipt of the statement of income and
expenditures from the barangay treasurer, the punong barangay shall
prepare
the barangay budget for the ensuing fiscal year in the manner and
within
the period prescribed in this Title and submit the annual barangay
budget
to the sangguniang barangay for legislative enactment.cralaw:red
(b) The total annual
appropriations for personal services of a barangay for one (1) fiscal
year
shall not exceed fifty-five percent (55%) of the total annual income
actually
realized from local sources during the next preceding fiscal year.cralaw:red
(c) The barangay budget
shall likewise be subject to the same budgetary requirements and
limitations
hereinabove prescribed.cralaw:red
SEC. 332. Effectivity
of Barangay Budgets. - The ordinance enacting the annual budget
shall
take effect at the beginning of the ensuing calendar year. An ordinance
enacting a supplemental budget, however, shall take effect upon its
approval
or on the date fixed therein. The responsibility for the execution of
the
annual and supplemental budgets and the accountability therefor shall
be
vested primarily in the punong barangay concerned.cralaw:red
SEC. 333. Review of the
Barangay Budget. - (a) Within ten (10) days from its approval,
copies
of the barangay ordinance authorizing the annual appropriations shall
be
furnished the sangguniang panlungsod or the sangguniang bayan, as the
case
may be, through the city or municipal budget officer. The sanggunian
concerned
shall have the power to review such ordinance in order to ensure that
the
provisions of this Title are complied with. If within sixty (60) days
after
the receipt of the ordinance, the sanggunian concerned takes no action
thereon, the same shall continue to be in full force and effect. If
within
the same period, the sanggunian concerned shall have ascertained that
the
ordinance contains appropriations in excess of the estimates of the
income
duly certified as collectible, or that the same has not complied with
the
budgetary requirements set forth in this Title, the said ordinance
shall
be declared inoperative in its entirety or in part. Items of
appropriation
contrary to, or in excess of, any of the general limitations or the
maximum
amount prescribed in this Title shall be disallowed or reduced
accordingly.cralaw:red
(b) Within the period
hereinabove fixed, the sangguniang panlungsod or sangguniang bayan
concerned
shall return the barangay ordinance, through the city or municipal
budget
officer, to the punong barangay with the advice of action thereon for
proper
adjustments, in which event, the barangay shall operate on the
ordinance
authorizing annual appropriations of the preceding fiscal year until
such
time that the new ordinance authorizing annual appropriations shall
have
met the objections raised. Upon receipt of such advice, the barangay
treasurer
or the city or municipal treasurer who has custody of the funds shall
not
make further disbursement from any item of appropriation declared
inoperative,
disallowed, or reduced.cralaw:red
SEC. 334. Barangay Financial
Procedures. - (a) The barangay treasurer shall collect all taxes,
fees,
and other charges due and contributions accruing to the barangay for
which
he shall issue official receipts, and shall deposit all collections
with
the city or municipal treasury or in the depository account maintained
in the name of the barangay within five (5) days after receipt thereof.
He may collect real property taxes and such other taxes as may be
imposed
by a province, city or municipality that are due in his barangay only
after
being deputized by the local treasurer concerned for the purpose.cralaw:red
(b) The barangay treasurer
may be authorized by the sangguniang barangay to make direct purchases
amounting to not more than One thousand pesos (P=1,000.00) at any time
for the ordinary and essential needs of the barangay. The petty cash
that
the barangay treasurer may be authorized to hold for the purpose shall
not exceed twenty percent (20%) of the funds available and to the
credit
of the barangay treasury.cralaw:red
(c) The financial records
of the barangay shall be kept in the office of the city or municipal
accountant
in simplified manner as prescribed by the Commission on Audit.
Representatives
of the Commission on Audit shall audit such accounts annually or as
often
as may be necessary and make a report of the audit to the sangguniang
panlungsod
or sangguniang bayan, as the case may be. The Commission on Audit shall
prescribe and put into effect simplified procedures for barangay
finances
within six (6) months following the effectivity of this Code.
CHAPTER 4. - EXPENDITURES,
DISBURSEMENTS, ACCOUNTING AND ACCOUNTABILITYSEC. 335. Prohibitions
Against
Expenditures for Religious or Private Purposes. - No public money
or
property shall be appropriated or applied for religious or private
purposes.
SEC. 336. Use of Appropriated
Funds and Savings. - Funds shall be available exclusively for the
specific
purpose for which they have been appropriated. No ordinance shall be
passed
authorizing any transfer of appropriations from one item to another.
However,
the local chief executive or the presiding officer of the sanggunian
concerned
may, by ordinance, be authorized to augment any item in the approved
annual
budget for their respective offices from savings in other items within
the same expense class of their respective appropriations.cralaw:red
SEC. 337. Restriction
Upon Limit of Disbursements. - Disbursements in accordance with
appropriations
in the approved annual budget may be made from any local fund in the
custody
of the treasurer, but the total disbursements from any local fund shall
in no case exceed fifty percent (50%) of the uncollected estimated
revenue
accruing to such local fund in addition to the actual collections:
Provided,
however, That no cash overdraft in any local fund shall be incurred at
the end of the fiscal year. In case of emergency arising from a
typhoon,
earthquake, or any other calamity, the sanggunian concerned may
authorize
the local treasurer to continue making disbursements from any local
fund
in his possession in excess of the limitations herein provided, but
only
for such purposes and amounts included in the approved annual budgets.
Any overdraft which may be incurred at the end of the year in any local
fund by virtue of the provisions hereof shall be covered with the first
collections of the immediately succeeding fiscal year accruing to such
local fund.cralaw:red
SEC. 338. Prohibitions
Against Advance Payments. - No money shall be paid on account of
any
contract under which no services have been rendered or goods delivered.cralaw:red
SEC. 339. Cash Advances.
- No cash advance shall be granted to any local official or employee,
elective
or appointive, unless made in accordance with the rules and regulations
as the Commission on Audit may prescribe.cralaw:red
SEC. 340. Persons Accountable
for Local Government Funds. - Any officer of the local government
unit
whose duty permits or requires the possession or custody of local
government
funds shall be accountable and responsible for the safekeeping thereof
in conformity with the provisions of this Title. Other local officers
who,
though not accountable by the nature of their duties, may likewise be
similarly
held accountable and responsible for local government funds through
their
participation in the use or application thereof.cralaw:red
SEC. 341. Prohibitions
Against Pecuniary Interest. - Without prejudice to criminal
prosecution
under applicable laws, any local treasurer, accountant, budget officer,
or other accountable local officer having any pecuniary interest,
direct
or indirect, in any contract, work or other business of the local
government
unit of which he is an accountable officer shall be administratively
liable
therefor.cralaw:red
SEC. 342. Liability for
Acts Done Upon Direction of Superior Officer, or Upon Participation of
Other Department Heads or Officers of Equivalent Rank. - Unless he
registers his objection in writing, the local treasurer, accountant,
budget
officer, or other accountable officer shall not be relieved of
liability
for illegal or improper use or application or deposit of government
funds
or property by reason of his having acted upon the direction of a
superior
officer, elective or appointive, or upon participation of other
department
heads or officers of equivalent rank. The superior officer directing,
or
the department head participating in such illegal or improper use or
application
or deposit of government funds or property, shall be jointly and
severally
liable with the local treasurer, accountant, budget officer, or other
accountable
officer for the sum or property so illegally or improperly used,
applied
or deposited.cralaw:red
SEC. 343. Prohibition
Against Expenses for Reception and Entertainment. - No money shall
be appropriated, used, or paid for entertainment or reception except to
the extent of the representation allowances authorized by law or for
the
reception of visiting dignitaries of foreign governments or foreign
missions,
or when expressly authorized by the President in specific cases.cralaw:red
SEC. 344. Certification
on, and Approval of, Vouchers. - No money shall be disbursed unless
the local budget officer certifies to the existence of appropriation
that
has been legally made for the purpose, the local accountant has
obligated
said appropriation, and the local treasurer certifies to the
availability
of funds for the purpose. Vouchers and payrolls shall be certified to
and
approved by the head of the department or office who has administrative
control of the fund concerned, as to validity, propriety, and legality
of the claim involved. Except in cases of disbursements involving
regularly
recurring administrative expenses such as payrolls for regular or
permanent
employees, expenses for light, water, telephone and telegraph services,
remittances to government creditor agencies such as the GSIS, SSS, LBP,
DBP, National Printing Office, Procurement Service of the DBM and
others,
approval of the disbursement voucher by the local chief executive
himself
shall be required whenever local funds are disbursed. In cases of
special
or trust funds, disbursements shall be approved by the administrator of
the fund. In case of temporary absence or incapacity of the department
head or chief of office, the officer next-in-rank shall automatically
perform
his function and he shall be fully responsible therefor.cralaw:red
SEC. 345. Officials Authorized
to Draw Checks in Settlement of Obligations. - Checks in settlement
of obligations shall be drawn by the local treasurer and countersigned
by the local administrator. In case of temporary absence or incapacity
of the foregoing officials, these duties shall devolve upon their
immediate
assistants.cralaw:red
SEC. 346. Disbursements
of Local Funds and Statement of Accounts. - Disbursements shall be
made in accordance with the ordinance authorizing the annual or
supplemental
appropriations without the prior approval of the sanggunian concerned.
Within thirty (30) days after the close of each month, the local
accountant
shall furnish the sanggunian with such financial statements as may be
prescribed
by the Commission on AuditIn the case of the year-end statement of
accounts,
the period shall be sixty (60) days after the thirty-first (31st) of
December.cralaw:red
SEC. 347. Rendition of
Accounts. - Local treasurers, accountants and other local
accountable
officers shall render their accounts within such time, in such form,
style,
and content and under such regulations as the Commission on Audit may
prescribe.
Provincial, city, and municipal auditors shall certify the balances
arising
in the accounts settled by them to the Chairman of the Commission on
Audit
and to the local treasurer, accountant, and other accountable officers.
Copies of the certification shall be prepared and furnished other local
officers who may be held jointly and severally liable for any loss or
illegal,
improper or unauthorized use or misappropriation of local funds or
property.cralaw:red
SEC. 348. Auditorial Visitation.
- The books, accounts, papers, and cash of local treasurer, accountant,
budget officer, or other accountable officers shall at all times be
open
for inspection of the Commission on Audit or its duly authorized
representative.
In case an examination of the accounts of a local treasurer discloses a
shortage in cash which should be on hand, it shall be the duty of the
examining
officer to seize the office and its contents, notify the Commission on
Audit, the local chief executive concerned, and the local accountant.
Thereupon,
the examining officer shall immediately turn over to the accountable
officer
next-in- rank in the local treasury service, unless the said officer is
likewise under investigation, the office of the treasurer and its
contents,
and close and render his accounts on the date of turnover. In case the
accountable officer next in rank is under investigation, the auditor
shall
take full possession of the office and its contents, close and render
his
accounts on the date of taking possession, and temporarily continue the
public business of such office until such time that the local treasurer
is restored or a successor has been duly designated. The local
treasurer
or accountable officer found with such shortage shall be automatically
suspended from office.cralaw:red
SEC. 349. Accounting for
Revenues. - Estimated revenues which remain unrealized at the close
of the fiscal year shall not be booked or credited to the
unappropriated
surplus or any other account.cralaw:red
SEC. 350. Accounting for
Obligations. - All lawful expenditures and obligations incurred
during
a fiscal year shall be taken up in the accounts of that year.cralaw:red
SEC. 351. General Liability
for Unlawful Expenditures. - Expenditures of funds or use of
property
in violation of this Title and other laws shall be a personal liability
of the official or employee responsible therefor.cralaw:red
SEC. 352. Posting of the
Summary of Income and Expenditures. - Local treasurers,
accountants,
budget officers and other accountable officers shall, within thirty
(30)
days from the end of each fiscal year, post in at least three (3)
publicly
accessible and conspicuous places in the local government unit a
summary
of all revenues collected and funds received including the
appropriations
and disbursements of such funds during the preceding fiscal year.cralaw:red
SEC. 353. The Official
Fiscal Year. - The official fiscal year of local government units
shall
be the period beginning with the first day of January and ending with
the
thirty-first day of December of the same year.cralaw:red
SEC. 354. Administrative
Issuances; Budget Operations Manual. - The Secretary of Budget and
Management jointly with the Chairman of the Commission on Audit shall,
within one (1) year from the effectivity of this Code, promulgate a
Budget
Operations Manual for local government units to improve and systematize
methods, techniques, and procedures employed in budget preparation,
authorization,
execution, and accountability.
TITLE VI. - PROPERTY
AND SUPPLY
MANAGEMENT IN THE LOCAL GOVERNMENT UNITSSEC. 355. Scope. -
This
Title shall govern the procurement, care, utilization, custody, and
disposal
of supplies, as defined herein, by local government units and the other
aspects of supply management at the local levels.
SEC. 356. General Rule
in Procurement or Disposal.- Except as otherwise provided herein,
acquisition
of supplies by local government units shall be through competitive
public
bidding. Supplies which have become unserviceable or no longer needed
shall
be sold, whenever applicable, at public auction, subject to applicable
rules and regulations.cralaw:red
SEC. 357. Definition of
Terms. - When used in this Title, the term -
(a) "Lowest Complying
and Responsible Bid" refers to the proposal of one who offers the
lowest
price, meets all the technical specifications and requirements of the
supplies
desired and, as a dealer in the line of supplies involved, maintains a
regular establishment, and has complied consistently with previous
commitments;
(b) "Suitable Substitute"
refers to that kind of article which would serve substantially the same
purpose or produce substantially the same results as the brand, type,
or
make of article originally desired or requisitioned;
(c) "Supplies" includes
everything, except real property, which may be needed in the
transaction
of public business or in the pursuit of any undertaking, project, or
activity,
whether in the nature of equipment, furniture, stationary materials for
construction or personal property of any sort, including non-personal
or
contractual services such as the repair and maintenance of equipment
and
furniture, as well as trucking, hauling, janitorial, security, and
related
services; and cralaw:red
(d) "Terms and Conditions"
refer to other requirements not affecting the technical specifications
and requirements of the required supplies desired such as bonding,
terms
of delivery and payment, and related preferences.cralaw:red
SEC. 358. Requirement
of Requisition. - Any order for supplies shall be filled by the
provincial
or city general services officer or the municipal or barangay treasurer
concerned, as the case may be, for any office or department of a local
government unit only upon written requisition as hereinafter provided.cralaw:red
SEC. 359. Officers Having
Authority to Draw Requisitions. - Requisitions shall be prepared by
the head of office or department needing the supplies, who shall
certify
as to their necessity for official use and specify the project or
activity
where the supplies are to be used.cralaw:red
SEC. 360. Certification
by the Local Budget Officer, Accountant, and Treasurer. - Every
requisition
must be accompanied by a certificate signed by the local budget
officer,
the local accountant, and the local treasurer showing that an
appropriation
therefor exists, the estimated amount of such expenditure has been
obligated,
and the funds are available for the purpose, respectively.cralaw:red
SEC. 361. Approval of
Requisitions. - Approval of the requisition by the head of office
or
department concerned who has administrative control of the
appropriation
against which the proposed expenditure is chargeable is deemed
sufficient,
except in case of requisition for supplies to be carried in stock which
shall be approved by the local chief executive concerned: Provided,
That
such supplies are listed or included in the annual procurement plan and
the maximum quantity thereof does not exceed the estimated consumption
corresponding to a programmed three-month period: Provided, further,
That
nothing herein contained shall be held as authorizing the purchase of
furniture
and equipment for stock purposes.cralaw:red
SEC. 362. Call for Bids.
- When procurement is to be made by local government units, the
provincial
or city general services officer or the municipal or barangay treasurer
shall call bids for open public competition. The call for bids shall
show
the complete specifications and technical descriptions of the required
supplies and shall embody all terms and conditions of participation and
award, terms of delivery and payment, and all other covenants affecting
the transaction. In all calls for bids, the right to waive any defect
in
the tender as well as the right to accept the bid most advantageous to
the government shall be reserved. In no case, however, shall failure to
meet the specifications or technical requirements of the supplies
desired
be waived.cralaw:red
SEC. 363. Publication
of Call for Bids. - The call for bids shall be given the widest
publicity
possible, sending, by mail or otherwise, any known prospective
participant
in the locality, of copies of the call and by posting copies of the
same
in at least three (3) publicly accessible and conspicuous places in the
provincial capitol or city, municipal, or barangay hall, as the case
may
be. The notice of the bidding may likewise be published in a newspaper
of general circulation in the territorial jurisdiction of the local
government
unit concerned when the provincial or city general services officer or
the municipal or barangay treasurer, as the case may be, deems it
necessary
in order to obtain the lowest responsible and complying bid. The
opening
of bids shall only be made in the presence of the provincial or city
auditor
or his duly authorized representative who shall initial and secure
copies
of the bids and certify the abstract of the bidding.cralaw:red
SEC. 364. The Committee
on Awards. - There shall be in every province, city or municipality
a committee on awards to decide the winning bids and questions of
awards
on procurement and disposal of property. The Committee on Awards shall
be composed of the local chief executive as chairman, the local
treasurer,
the local accountant, the local budget officer, the local general
services
officer, and the head of office or department for whose use the
supplies
are being procured, as members. In case a head of office or department
would sit in a dual capacity, a member of the sanggunian elected from
among
its members shall sit as a member. The committee on awards at the
barangay
level shall be the sangguniang barangay. No national official shall sit
as a member of the committee on awards. The results of the bidding
shall
be made public by conspicuously posting the same in the provincial
capitol
or city, municipal, or barangay hall.cralaw:red
SEC. 365. Rule on Awards.
- Awards in the procurement of supplies shall be given to the lowest
complying
and responsible bid which meets all the terms and conditions of the
contract
or undertaking.cralaw:red
SEC. 366. Procurement
Without Public Bidding. - Procurement of supplies may be made
without
the benefit of public bidding under any of the following modes:chanrobles virtual law library
(a) Personal canvass
of responsible merchants;
(b) Emergency purchase;
(c) Negotiated purchase;
(d) Direct purchase
from manufacturers or exclusive distributors; and cralaw:red
(e) Purchase from other
government entities.cralaw:red
SEC. 367. Procurement
through Personal Canvass. - Upon approval by the Committee on
Awards,
procurement of supplies may be effected after personal canvass of at
least
three (3) responsible suppliers in the locality by a committee of three
(3) composed of the local general services officer or the municipal or
barangay treasurer, as the case may be, the local accountant, and the
head
of office or department for whose use the supplies are being procured.
The award shall be decided by the Committee on Awards. Purchases under
this Section shall not exceed the amounts specified hereunder for all
items
in any one (1) month for each local government unit:chanrobles virtual law library
Provinces and Cities and
Municipalities within the Metropolitan Manila Area:chanroblesvirtuallawlibrary
- First and Second Class
- One
hundred fifty thousand pesos (P150,000.00)
- Third and Fourth Class
- One
hundred thousand pesos (P100,000.00)
- Fifth and Sixth Class
- Fifty
thousand pesos (P50,000.00)
Municipalities:chanroblesvirtuallawlibrary
- First Class - Sixty
thousand
pesos (P60,000.00)
- Second and Third Class
- Forty
thousand pesos (P40,000.00)
- Fourth Class and Below
- Twenty
thousand pesos (P20,000.00)
SEC. 368. Emergency Purchase.
- In cases of emergency where the need for the supplies is
exceptionally
urgent or absolutely indispensable and only to prevent imminent danger
to, or loss of, life or property, local government units may, through
the
local chief executive concerned, make emergency purchases or place
repair
orders, regardless of amount, without public biddingDelivery of
purchase
orders or utilization of repair orders pursuant to this Section shall
be
made within ten (10) days after placement of the same. Immediately
after
the emergency purchase or repair order is made, the chief of office or
department making the emergency purchase or repair order shall draw a
regular
requisition to cover the same which shall contain the following:chanroblesvirtuallawlibrary
(a) A complete description
of the supplies acquired or the work done or to be performed;
(b) By whom furnished
or executed;
(c) Date of placing
the order and the date and time of delivery or execution;
(d) The unit price and the
total contract price;
(e) A brief and concise
explanation of the circumstances why procurement was of such urgency
that
the same could not be done through the regular course without involving
danger to, or loss of, life or property;
(f) A certification
of the provincial or city general services or the municipal or barangay
treasurer, as the case may be, to the effect that the price paid or
contracted
for was the lowest at the time of procurement; and cralaw:red
(g) A certification
of the local budget officer as to the existence of appropriations for
the
purpose, the local accountant as to the obligation of the amount
involved,
and the local treasurer as to the availability of funds. The goods or
services
procured under this Section must be utilized or availed of within
fifteen
(15) days from the date of delivery or availability. Without prejudice
to criminal prosecution under applicable laws, the local chief
executive,
the head of department, or the chief of office making the procurement
shall
be administratively liable for any violation of this Section and shall
be a ground for suspension or dismissal from service.
SEC. 369. Negotiated
Purchase. - (a) In cases where public biddings have failed for two
(2) consecutive times and no suppliers have qualified to participate or
win in the biddings, local government units may, through the local
chief
executive concerned, undertake the procurement of supplies by
negotiated
purchase, regardless of amount, without public bidding: Provided,
however,
That the contract covering the negotiated purchase shall be approved by
the sanggunian concerned. Delivery of purchase orders or utilization of
repair orders pursuant to this Section shall be made within seven (7)
days
after placement of the same. Immediately after the negotiated purchase
or repair order is made, the local chief executive concerned shall draw
a regular requisition to cover the same which shall contain the
following:chanrobles virtual law library
(1) A complete description
of the supplies acquired or the work done or to be performed;
(2) By whom furnished
or executed;
(3) Date of placing
the order and the date and time of delivery or execution;
(4) The unit price
and the total contract price;
(5) A certification of the
provincial or city general services or the municipal or barangay
treasurer,
as the case may be, to the effect that the price paid or contracted for
was the lowest at the time of procurement;
(6) A certification
to the effect that the price paid or contracted for was the lowest at
the
time of procurement; and cralaw:red
(7) A certification
of the local budget officer as to the existence of appropriations for
the
purpose, the local accountant as to the obligation of the amount
involved,
and the local treasurer as to the availability of funds.cralaw:red
(b) In case of repeat
orders for regular supplies, procurement may be made by negotiated
purchase:
Provided, That the repeat order is made within three (3) months from
the
last procurement of the same item: Provided, further, That the same
terms
and conditions of sale are obtained for the said repeat order.cralaw:red
SEC. 370. Procurement
from Duly Licensed Manufacturer. - Procurement may be made directly
from duly licensed manufacturers in cases of supplies of Philippine
manufacture
or origin and in case there are two (2) or more manufacturers of the
required
supplies, canvass of the known manufacturers shall be conducted to
obtain
the lowest price for the quality of the said supplies.cralaw:red
SEC. 371. Procurement
from Exclusive Philippine Agents or Distributors. - Procurement
may,
in the case of supplies of foreign origin, preferably be made directly
from the exclusive or reputable Philippine distributors or agents,
subject
to the following conditions:chanrobles virtual law library
(a) That the Philippine
distributor has no subdealers selling at lower prices; and cralaw:red
(b) That no suitable
substitutes of substantially the same quality are available at lower
prices.cralaw:red
SEC. 372. Procurement
from Government Entities. - Procurement may be made directly from
government
entities producing the required supplies, including units or agencies
of
foreign governments with which the Philippines maintains diplomatic
relations.
In the latter case, prior authority from the Office of the President
shall
be required.cralaw:red
SEC. 373. Annual Procurement
Program. - (a) On or before the fifteenth (15th) day of July each
year,
the local chief executive shall prepare an annual procurement program
for
the ensuing fiscal year which shall contain an itemized list of the
estimated
quantity of supplies needed for such year, a complete description
thereof
as to kind, quality, estimated cost, and balance on hand: Provided,
however,
That the total estimated cost of the approved annual procurement
program
shall not exceed the total appropriations authorized for the
acquisition
of supplies. The local government units may augment the supplies and
equipment
provided by the Supreme Court to the lower courts located in their
respective
jurisdictions.cralaw:red
(b) Except in emergency
cases or where urgent indispensable needs could not have been
reasonably
anticipated, no purchase of supplies shall be made unless included in,
or covered by, the approved procurement program.cralaw:red
(c) The conversion
of excess cash into supplies stock is hereby prohibited except to the
extent
of the kind and quantity specified in the approved annual procurement
plan.
A violation of this Section shall be a ground for suspension or
dismissal
of any official or employee responsible therefor.cralaw:red
SEC. 374. Establishment
of an Archival System. - Every local government unit shall provide
for the establishment of an archival system to ensure the safety and
protection
of all government property, public documents or records such as records
of births, marriages, property inventory, land assessments, land
ownership,
tax payments, tax accounts, and business permits, and such other
records
or documents of public interest in the various departments and offices
of the provincial, city, or municipal government concerned.cralaw:red
SEC. 375. Primary and
Secondary Accountability for Government Property. - (a) Each head
of
department or office of a province, city, municipality or barangay
shall
be primarily accountable for all government property assigned or issued
to his department or office. The person or persons entrusted with the
possession
or custody of government property under the accountability of any head
of department or office shall be immediately accountable to such
officer.cralaw:red
(b) The head of a department
or office primarily accountable for government property may require any
person in possession of the property or having custody and control
thereof
under him to keep such records and make reports as may be necessary for
his own information and protection.cralaw:red
(c) Buildings and other
physical structures shall be under the accountability and
responsibility
of the provincial or city general services officer or the municipal
mayor
or punong barangay, as the case may be.cralaw:red
(d) Every officer primarily
accountable for government property shall keep a complete record of all
properties under his charge and render his accounts therefor
semiannually
to the provincial or city general services officer or the municipal
mayor
or punong barangay, as the case may be.cralaw:red
SEC. 376. Responsibility
for Proper Use and Care of Government Property. - The person in
actual
physical possession of government property or entrusted with its
custody
and control shall be responsible for its proper use and care and shall
exercise due diligence in the utilization and safekeeping thereof.cralaw:red
SEC. 377. Measure of Liability
of Persons Accountable for Government Property. - (a) The person
immediately
accountable for government property shall be liable for its money value
in case of the illegal, improper or unauthorized use or misapplication
thereof, by himself or any other person for whose acts he may be
responsible,
and he shall be liable for all loss, damage, or deterioration
occasioned
by negligence in the keeping or use of such property unless it is
proved
that he has exercised due diligence and care in the utilization and
safekeeping
thereof.cralaw:red
(b) Unless he registers
his objection in writing, an accountable person shall not be relieved
from
liability by reason of his having acted under the direction of a
superior
officer in using property with which he is chargeable; but the officer
directing any illegal, unauthorized or improper use of property shall
first
be required to answer therefor.cralaw:red
(c) In cases of loss,
damage, or deterioration of government property arising from, or
attributable
to, negligence in security, the head of the security agency shall be
held
liable therefor.cralaw:red
SEC. 378. Credit for Loss
Occurring in Transit or Due to Casualty. - When a loss of
government
property occurs while the same is in transit or is caused by fire,
theft,
force majeure, or other casualty, the officer accountable therefor or
having
custody thereof shall immediately notify the provincial or city auditor
concerned within thirty (30) days from the date the loss occurred or
for
such longer period as the provincial, city or municipal auditor, as the
case may be, may in the particular case allow, and he shall present his
application for relief, with the available evidence in support thereof.
An officer who fails to comply with this requirement shall not be
relieved
of liability or allowed credit for any such loss in the settlement of
his
accounts. A provincial, city or municipal auditor shall not allow
credit
for these losses unless so expressly authorized by the Chairman of the
Commission on Audit , to be exercised only if the loss is not in excess
of fifty thousand pesos (P=50,000.00). In any case when the allowance
of
credit is not within the competence of the provincial, city or
municipal
auditor, the application and evidence, with the recommendation of the
auditor
concerned, shall be forwarded to the Chairman of the Commission on
Audit
for his appropriate action.cralaw:red
SEC. 379. Property Disposal.
- When property of any local government unit has become unserviceable
for
any cause or is no longer needed, it shall, upon application of the
officer
accountable therefor, be inspected and appraised by the provincial,
city
or municipal auditor , as the case may be, or his duly authorized
representative
or that of the Commission on Audit and, if found valueless or unusable,
shall be destroyed in the presence of the inspecting officer. If found
valuable, the same shall be sold at public auction to the highest
bidder
under the supervision of the committee on awards and in the presence of
the provincial, city or municipal auditor or his duly authorized
representative.
Notice of the public auction shall be posted in at least three (3)
publicly
accessible and conspicuous places, and if the acquisition cost exceeds
One hundred thousand pesos (P=100,000.00) in the case of provinces and
cities, and Fifty thousand (P=50,000.00) in the case of municipalities,
notice of auction shall be published at least two (2) times within a
reasonable
period in a newspaper of general circulation in the locality.cralaw:red
SEC. 380. Negotiated Sale
of Property. - Property no longer needed may also be disposed of at
a private sale at such price as may be determined by the committee on
awards,
subject to the approval of the Commission on Audit or its duly
authorized
representative when the acquisition or transfer cost of the property
exceeds
Fifty thousand pesos (P=50,000.00) in the case of provinces and cities,
and Twenty-five thousand (P=25,000.00) in the case of municipalities
and
barangays. In case of real property, the disposal shall be subject to
the
approval of the Commission on Audit regardless of the value or cost
involved.cralaw:red
SEC. 381. Transfer Without
Cost. - Property which has become unserviceable or is no longer
needed
may be transferred without cost to another office, agency, subdivision
or instrumentality of the national government or another local
government
unit at an appraised valuation determined by the local committee on
awards.
Such transfer shall be subject to the approval of the sanggunian
concerned
making the transfer and by the head of the office, agency, subdivision,
instrumentality or local government unit receiving the property.cralaw:red
SEC. 382. Tax Exemption
Privileges of Local Government Units. - Local government units
shall
be exempt from the payment of duties and taxes for the importation of
heavy
equipment or machineries which shall be used for the construction,
improvement,
repair, and maintenance of roads, bridges and other infrastructure
projects,
as well as garbage trucks, fire trucks, and other similar equipment:
Provided,
however, That such equipment or machineries shall not be disposed of,
either
by public auction or negotiated sale as hereinabove provided, within
five
(5) years from the importation thereof. In case the machinery or
equipment
is sold within the five-year period, the purchasers or recipients shall
be considered the importers thereof, and shall be liable for duties and
taxes computed on the book value of such importation.cralaw:red
SEC. 383. Implementing
Rules and Regulations. - The Chairman of the Commission on Audit
shall
promulgate the rules and regulations necessary to effectively implement
the provisions of this Title, including requirements as to testing,
inspection,
and standardization of supply and property. |