CHAPTER VI of competent jurisdiction otherwise the assessment

Taxpayer's Remedies becomes conclusive and unappealable.

Section 194. Periods of Assessment and Collection. - San Juan vs. Castro

(a) Local taxes, fees, or charges shall be Facts: Romulo D. San Juan challenges through
assessed within five (5) years from the date Mandamus the City Treasurer Ricardo L. Castro’s
they became due. No action for the collection contention that the basis of payment of his taxes of
of such taxes, fees, or charges, whether his conveyance of properties should be the fair market
administrative or judicial, shall be instituted value of the property (as opposed to his own basis—
after the expiration of such period: Provided, the value of the consideration)
That. taxes, fees or charges which have
accrued before the effectivity of this Code may Held: Petitioner should have followed Sec. 195 of the
be assessed within a period of three (3) years LGC, requiring that appeals on assessments be filed
from the date they became due. before courts of competent jurisdiction.

(b) In case of fraud or intent to evade the The Mandamus petition is being used to compel
payment of taxes, fees, or charges, the same respondent to accept petitioner’s payment based on
may be assessed within ten (10) years from his own computation.
discovery of the fraud or intent to evade
payment. City Treasurer of Manila vs. Philippine Beverage
Partners Inc.
(c) Local taxes, fees, or charges may be
collected within five (5) years from the date of Held: Requisites to seek tax refund:
assessment by administrative or judicial
action. No such action shall be instituted after
1. Payment of the assessed tax
the expiration of said period: Provided,
2. File a protest
however, That, taxes, fees or charges
assessed before the effectivity of this Code
may be collected within a period of three (3) Section 196. Claim for Refund of Tax Credit. - No
years from the date of assessment. 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
(d) The running of the periods of prescription
credit has been filed with the local treasurer. No case
provided in the preceding paragraphs shall be
or proceeding shall be entertained in any court after
suspended for the time during which:
the expiration of two (2) years from the date of the
payment of such tax, fee, or charge, or from the date
(1) The treasurer is legally prevented the taxpayer is entitled to a refund or credit.
from making the assessment of
collection;
Metro Manila Shopping Mecca Corp. vs. Toledo
(2) The taxpayer requests for a
Issue: Whether petitioner is entitled for tax refund of
reinvestigation and executes a waiver
the local business taxes it paid to the City of Manila?
in writing before expiration of the
period within which to assess or
collect; and Held: Requisites of Tax Refund/Credit

(3) The taxpayer is out of the country 1. The taxpayer concerned must file a written
or otherwise cannot be located. claim for refund/credit with the local treasurer
2. Ther case or proceeding for refund has to be
filed within 2 years from the date of the
Section 195. Protest of Assessment. - When the local
payment of tax, fee, or charge or from the
treasurer or his duly authorized representative finds
date the taxpayer is entitled to a refund/credit.
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 Petitioner failed to file their written claim.
deficiency, the surcharges, interests and penalties.
Within sixty (60) days from the receipt of the notice of Tax law for refund/credit is construed in strictissimi
assessment, the taxpayer may file a written protest juris against the one claiming it.
with the local treasurer contesting the assessment;
otherwise, the assessment shall become final and City of Manila vs. Cosmos Bottling Corp.
executory. The local treasurer shall decide the protest
within sixty (60) days from the time of its filing. If the Issue: Does collection of business taxes by the City of
local treasurer finds the protest to be wholly or partly Manila under its Sec. 14 and 21 of the Revenue Code
meritorious, he shall issue a notice cancelling wholly of Manila constitutes double taxation
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
Held: (d) The appraisal, assessment, levy and
collection of real property tax shall not be let
The case is similar in the City of Manila vs. Coca Cola to any private person; and
Bottlers when the Court barred collection of business
tax in both Secs. 143(a) and 143(h) of the LGC (e) The appraisal and assessment of real
property shall be equitable.
Requisites for tax refund/credit:
Section 199. Definitions. - When used in this Title:
1. Protest in writing, regardless whether the
assessment is paid (a) "Acquisition Cost" for newly-acquired
2. Such protest be made within 60 days from the machinery not yet depreciated and appraised
receipt of the notice of the assessment within the year of its purchase, refers to the
3. Court action be made within 30 days from actual cost of the machinery to its present
denial or inaction of the protest owner, plus the cost of transportation,
• Hence: the taxpayer could not avail of the handling, and installation at the present site;
full extent of the 2-year period within
which to imitate the action in court (b) "Actual Use" refers to the purpose for
which the property is principally or
By filing a timely court action before RTC, Cosmos predominantly utilized by the person in
may still maintain its action for refund possession thereof;

International Container Terminal Services Inc. vs. City (c) "Ad Valorem Tax" is a levy on real property
of Manila determined on the basis of a fixed proportion
of the value of the property;
Issue: Whether petitioner could maintain a court
action against respondent on the ground that (d) "Agricultural Land" is land devoted
collection of taxes under Manila Ordinances No. 7794 principally to the planting of trees, raising of
and 7807 constituted double taxation; notwithstanding crops, livestock and poultry, dairying, salt
the fact he only filed written claims on taxes collected making, inland fishing and similar aquacultural
under Ordinance No. 7794 activities, and other agricultural activities, and
is not classified as mineral, timber, residential,
Held: commercial or industrial land;

Petitioner’s failure to file written claims of refund for all (e) "Appraisal" is the act or process of
the taxes under Sec. 21 (A) [7797] with respondent determining the value of property as of a
City Treasurer is warranted under the circumstances specified date for a specific purpose;

The issue raised by petitioner is a question of law, (f) "Assessment" is the act or process of
which exempts the plaintiff from the doctrine of determining the value of a property, or
exhaustion of administrative remedies proportion thereof subject to tax, including the
discovery, listing, classification, and appraisal
TITLE II of properties;
REAL PROPERTY TAXATION
(g) "Assessment Level" is the percentage
CHAPTER I applied to the fair market value to determine
General Provisions the taxable value of the property;

Section 197. Scope. - This Title shall govern the (h) "Assessed Value" is the fair market value
administration, appraisal, assessment, levy and of the real property multiplied by the
collection of real property tax. assessment level. It is synonymous to taxable
value;
Section 198. Fundamental Principles. - The
appraisal, assessment, levy and collection of real (i) "Commercial Land" is land devoted
property tax shall be guided by the following principally for the object of profit and is not
fundamental principles: classified as agricultural, industrial, mineral,
timber, or residential land;
(a) Real property shall be appraised at its
current and fair market value; (j) "Depreciated Value" is the value remaining
after deducting depreciation from the
acquisition cost;
(b) Real property shall be classified for
assessment purposes on the basis of its
actual use; (k) "Economic Life" is the estimated period
over which it is anticipated that a machinery or
equipment may be profitably utilized;
(c) Real property shall be assessed on the
basis of a uniform classification within each
local government unit; (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 Held:
made to a property or an amelioration in its
condition, amounting to more than a mere Manila Electric Company vs. City Assessor and City
repair or replacement of parts involving capital Treasurer of Lucena City: [submarine cables] are no
expenditures and labor, which is intended to longer exempted from real property tax and may
enhance its value, beauty or utility or to adapt qualify as machinery subject to real property tax under
it for new or further purposes; LGC

(n) "Industrial Land" is land devoted principally The submarine cables are found within the country’s
to industrial activity as capital investment and territorial sea (12 nautical miles from the nearest
is not classified as agricultural, commercial, baseline) in accordance with UNCLOS
timber, mineral or residential land;
The real property tax exemption granted by virtue of
(o) "Machinery" embraces machines, petitioner’s franchise has been withdrawn with the
equipment, mechanical contrivances, passage of LGC
instruments, appliances or apparatus which
may or may not be attached, permanently or Section 200. Administration of the Real Property
temporarily, to the real property. It includes Tax. - The provinces and cities, including the
the physical facilities for production, the municipalities within the Metropolitan Manila Area,
installations and appurtenant service facilities, shall be primarily responsible for the proper, efficient
those which are mobile, self-powered or self- and effective administration of the real property tax.
propelled, and those not permanently
attached to the real property which are
CHAPTER II
actually, directly, and exclusively used to meet
Appraisal and Assessment of Real Property
the needs of the particular industry, business
or activity and which by their very nature and
purpose are designed for, or necessary to its Section 201. Appraisal of Real Property. - All real
manufacturing, mining, logging, commercial, property, whether taxable or exempt, shall be
industrial or agricultural purposes; appraised at the current and fair market value
prevailing in the locality where the property is situated.
The Department of Finance shall promulgate the
(p) "Mineral Lands" are lands in which
necessary rules and regulations for the classification,
minerals, metallic or non-metallic, exist in
appraisal, and assessment of real property pursuant
sufficient quantity or grade to justify the
to the provisions of this Code.
necessary expenditures to extract and utilize
such materials;
Section 202. Declaration of real Property by the
Owner or Administrator. - It shall be the duty of all
(q) "Reassessment" is the assigning of new
persons, natural or juridical, owning or administering
assessed values to property, particularly real
real property, including the improvements therein,
estate, as the result of a general, partial, or
within a city or municipality, or their duly authorized
individual reappraisal of the property;
representative, to prepare, or cause to be prepared,
and file with the provincial, city or municipal assessor,
(r) "Remaining Economic Life" is the period of a sworn statement declaring the true value of their
time expressed in years from the date of property, whether previously declared or undeclared,
appraisal to the date when the machinery taxable or exempt, which shall be the current and fair
becomes valueless; market value of the property, as determined by the
declarant. Such declaration shall contain a description
(s) "Remaining Value" is the value of the property sufficient in detail to enable the
corresponding to the remaining useful life of assessor or his deputy to identify the same for
the machinery; assessment purposes. The sworn declaration of real
property herein referred to shall be filed with the
(t) "Replacement or Reproduction Cost" is the assessor concerned once every three (3) years during
cost that would be incurred on the basis of the period from January first (1st) to June thirtieth
current prices, in acquiring an equally (30th) commencing with the calendar year 1992.
desirable substitute property, or the cost of
reproducing a new replica of the property on Section 203. Duty of Person Acquiring Real Property
the basis of current prices with the same or or Making Improvement Thereon. - It shall also be the
closely similar material; and duty of any person, or his authorized representative,
acquiring at any time real property in any municipality
(u) "Residential Land" is land principally or city or making any improvement on real property, to
devoted to habitation. prepare, or cause to be prepared, and file with the
provincial, city or municipal assessor, a sworn
Capitol Wireless Inc. vs. The Provincial Treasurer of statement declaring the true value of subject property,
Batangas within sixty (60) days after the acquisition of such
property or upon completion or occupancy of the
Issue: Whether petition is liable for real property tax improvement, whichever comes earlier.
on its ownership of submarine cable systems
Section 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 National Power Corporation vs. Provincial Treasurer
provincial, city or municipal assessor shall himself of Benguet:
declare the property in the name of the defaulting
owner, if known, or against an unknown owner, as the Issue: Is petitioner, a GOCC now liable for real
case may be, and shall assess the property for property tax assessments issued by respondents
taxation in accordance with the provision of this Title.
No oath shall be required of a declaration thus made Held: The requirements for application for exemption
by the provincial, city or municipal assessor. from real property tax payment applies to EVERY
PERSON i.e., submission to the assessor sufficient
Section 205. Listing of Real Property in the documentary evidence within 30 days from
Assessment Rolls. - declaration of properties for tax purposes

(a) In every province and city, including the Section 207. Real Property Identification System. - All
municipalities within the Metropolitan Manila declarations of real property made under the
Area, there shall be prepared and maintained provisions of this Title shall be kept and filed under a
by the provincial, city or municipal assessor uniform classification system to be established by the
an assessment roll wherein shall be listed all provincial, city or municipal assessor.
real property, whether taxable or exempt,
located within the territorial jurisdiction of the Section 208. Notification of Transfer of Real Property
local government unit concerned. Real Ownership. - Any person who shall transfer real
property shall be listed, valued and assessed property ownership to another shall notify the
in the name of the owner or administrator, or provincial, city or municipal assessor concerned within
anyone having legal interest in the property. sixty (60) days from the date of such transfer. The
notification shall include the mode of transfer, the
(b) The undivided real property of a deceased description of the property alienated, the name and
person may be listed, valued and assessed in address of the transferee.
the name of the estate or of the heirs and
devisees without designating them Section 209. Duty of Registrar of Deeds to Appraise
individually; and undivided real property other Assessor of Real Property Listed in Registry. -
than that owned by a deceased may be listed,
valued and assessed in the name of one or
(a) To ascertain whether or not any real
more co-owners: Provided, however, That
property entered in the Registry of Property
such heir, devisee, or co-owner shall be liable
has escaped discovery and listing for the
severally and proportionately for all obligations
purpose of taxation, the Registrar of Deeds
imposed by this Title and the payment of the
shall prepare and submit to the provincial, city
real property tax with respect to the undivided
or municipal assessor, within six (6) months
property.
from the date of effectivity of this Code and
every year thereafter, an abstract of his
(c) The real property of a corporation, registry, which shall include brief but sufficient
partnership, or association shall be listed, description of the real properties entered
valued and assessed in the same manner as therein, their present owners, and the dates of
that of an individual. their most recent transfer or alienation
accompanied by copies of corresponding
(d) Real property owned by the Republic of deeds of sale, donation, or partition or other
the Philippines, its instrumentalities and forms of alienation.
political subdivisions, the beneficial use of
which has been granted, for consideration or (b) It shall also be the duty of the Registrar of
otherwise, to a taxable person, shall be listed, Deeds to require every person who shall
valued and assessed in the name of the present for registration a document of transfer,
possessor, grantee or of the public entity if alienation, or encumbrance of real property to
such property has been acquired or held for accompany the same with a certificate to the
resale or lease. effect that the real property subject of the
transfer, alienation, or encumbrance, as the
Section 206. Proof of Exemption of Real Property case may be, has been fully paid of all real
from Taxation. - Every person by or for whom real property taxes due thereon. Failure to provide
property is declared, who shall claim tax exemption such certificate shall be a valid cause for the
for such property under this Title shall file with the Registrar of Deeds to refuse the registration of
provincial, city or municipal assessor within thirty (30) the document.
days from the date of the declaration of real property
sufficient documentary evidence in support of such Section 210. Duty of Official Issuing Building Permit
claim including corporate charters, title of ownership, or Certificate of Registration of Machinery to Transmit
articles of incorporation, by-laws, contracts, affidavits, Copy to Assessor. - Any public official or employee
certifications and mortgage deeds, and similar who may now or hereafter be required by law or
documents. regulation to issue to any person a permit for the
construction, addition, repair, or renovation of a
If the required evidence is not submitted within the building, or permanent improvement on land, or a
period herein prescribed, the property shall be listed certificate of registration for any machinery, including
as taxable in the assessment roll. However, if the machines, mechanical contrivances, and apparatus
property shall be proven to be tax exempt, the same attached or affixed on land or to another real property,
shall be dropped from the assessment roll. shall transmit a copy of such permit or certificate
within thirty (30) days of its issuance, to the assessor The city or municipality within the Metropolitan Manila
of the province, city or municipality where the property Area, through their respective sanggunian, shall have
is situated. the power to classify lands as residential, agricultural,
commercial, industrial, mineral, timberland, or special
Section 211. Duty of Geodetic Engineers to Furnish in accordance with their zoning ordinances.
Copy of Plans to Assessor. - It shall be the duty of all
geodetic engineers, public or private, to furnish free of Section 216. Special Classes of Real Property. - All
charge to the assessor of the province, city or lands, buildings, and other improvements thereon
municipality where the land is located with a white or actually, directly and exclusively used for hospitals,
blue print copy of each of all approved original or cultural, or scientific purposes, and those owned and
subdivision plans or maps of surveys executed by used by local water districts, and government-owned
them within thirty (30) days from receipt of such plans or controlled corporations rendering essential public
from the Lands Management Bureau, the Land services in the supply and distribution of water and/or
Registration Authority, or the Housing and Land Use generation and transmission of electric power shall be
Regulatory Board, as the case may be. classified as special.

Section 212. Preparation of Schedule of Fair Market Section 217. Actual Use of Real Property as Basis for
Values. - Before any general revision of property Assessment. - Real property shall be classified,
assessment is made pursuant to the provisions of this valued and assessed on the basis of its actual use
Title, there shall be prepared a schedule of fair market regardless of where located, whoever owns it, and
values by the provincial, city and municipal assessor whoever uses it.
of the municipalities within the Metropolitan Manila
Area for the different classes of real property situated Section 218. Assessment Levels. - The assessment
in their respective local government units for levels to be applied to the fair market value of real
enactment by ordinance of the sanggunian property to determine its assessed value shall be
concerned. The schedule of fair market values shall fixed by ordinances of the sangguniang panlalawigan,
be published in a newspaper of general circulation in sangguniang panlungsod or sangguniang bayan of a
the province, city or municipality concerned or in the municipality within the Metropolitan Manila Area, at
absence thereof, shall be posted in the provincial the rates not exceeding the following:
capitol, city or municipal hall and in two other
conspicuous public places therein. (a) On Lands:

Figuerres vs. CA: Publication or posting of fair market

values of real property by the local government unit is CLASS ASSESSMENT LEVELS
required Residential 20%
Agricultural 40%
Ty vs. Trampe:
Commercial 50%
Issue: Is the property tax assessment made solely by Industrial 50%
the municipal assessor of Pasig City valid?
Mineral 50%
Held: Construction of Sec. 212 of the LGC and Sec. 9 Timberland 20%
PD 921 taken together requires the joint creation of
tax assessments made by the assessors in the district
(b) On Buildings and Other Structures:
Section 213. Authority of Assessor to Take
Evidence. - For the purpose of obtaining information
<td
on which to base the market value of any real
</td
property, the assessor of the province, city or
municipality or his deputy may summon the owners of (1) Residential
the properties to be affected or persons having legal Fair market Value
interest therein and witnesses, administer oaths, and Over Not Over Assessment
take deposition concerning the property, its Levels
ownership, amount, nature, and value.
P175,000.00 0%
Section 214. Amendment of Schedule of Fair Market P175,000.00 300,000.00 10%
Values. - The provincial, city or municipal assessor
300,000.00 500,000.00 20%
may recommend to the sanggunian concerned
amendments to correct errors in valuation in the 500,000.00 750,000.00 25%
schedule of fair market values. The sanggunian
750,000.00 1,000,000.00 30%
concerned shall, by ordinance, act upon the
recommendation within ninety (90) days from receipt 1,000,000.00 2,000,000.00 35%
thereof.
2,000,000.00 5,000,000.00 40%
Section 215. Classes of Real Property for 5,000,000.00 10,000,000.00 50%
Assessment Purposes. - For purposes of assessment, 10,000,000.00 60%
real property shall be classified as residential,
agricultural, commercial, industrial, mineral, (2) Agricultural
timberland or special. Fair Market Value
 Over Not Over Assessment generation and transmission of
Levels electric power
P300,000.00 25%
Section 219. General Revision of Assessment and
P300,000.00 500,000.00 30% Property Classification. - The provincial, city or
500,000.00 750,000.00 35% municipal assessor shall undertake a general revision
of real property assessments within two (2) years after
750,000.00 1,000,000.00 40% the effectivity of this Code and every three (3) years
1,000,000.00 2,000,000.00 45% thereafter.
2,000,000.00 50%
Section 220. Valuation of Real Property. - In cases
(3) Commercial / Industrial where (a) real property is declared and listed for
Fair Market Value taxation purposes for the first time; (b) there is an
Over Not Over Assessment ongoing general revision of property classification and
Levels assessment; or (c) a request is made by the person in
whose name the property is declared, the provincial,
P300,000.00 30% city or municipal assessor or his duly authorized
P300,000.00 500,000.00 35% deputy shall, in accordance with the provisions of this
Chapter, make a classification, appraisal and
500,000.00 750,000.00 40% assessment or taxpayer's valuation thereon:
750,000.00 1,000,000.00 50% Provided, however, That the assessment of real
property shall not be increased oftener than once
1,000,000.00 2,000,000.00 60% every three (3) years except in case of new
2,000,000.00 5,000,000.00 70% improvements substantially increasing the value of
said property or of any change in its actual use.
5,000,000.00 10,000,000.00 75%
10,000,000.00 80% Section 221. Date of Effectivity of Assessment or
Reassessment. - All assessments or reassessments
(4) Timberland made after the first (1st) day of January of any year
Fair Market Value shall take effect on the first (1st) day of January of the
Over Not Over Assessment succeeding year: Provided, however, That the
Levels reassessment of real property due to its partial or total
destruction, or to a major change in its actual use, or
P300,000.00 45% to any great and sudden inflation or deflation of real
P300,000.00 500,000.00 50% property values, or to the gross illegality of the
assessment when made or to any other abnormal
500,000.00 750,000.00 55% cause, shall be made within ninety (90) days from the
750,000.00 1,000,000.00 60% date any such cause or causes occurred, and shall
take effect at the beginning of the quarter next
5,000,000.00 2,000,000.00 65% following the reassessment.
2,000,000.00 70%
Section 222. Assessment of Property Subject to Back
Taxes. - Real property declared for the first time shall
(c) On Machineries
be assessed for taxes for the period during which it
would have been liable but in no case of more than
Class Assessment Levels ten (10) years prior to the date of initial assessment:
Agricultural 40% Provided, however, That such taxes shall be
computed on the basis of the applicable schedule of
Residential 50% values in force during the corresponding period.
Commercial 80%
If such taxes are paid on or before the end of the
Industrial 80% quarter following the date the notice of assessment
was received by the owner or his representative, no
(d) On Special Classes: The assessment interest for delinquency shall be imposed thereon;
levels for all lands buildings, machineries and otherwise, such taxes shall be subject to an interest at
other improvements; 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.
Actual Use Assessment
Level
Section 223. Notification of New or Revised
Cultural 15% Assessment. - When real property is assessed for the
Scientific 15% first time or when an existing assessment is increased
or decreased, the provincial, city or municipal
Hospital 15% assessor shall within thirty (30) days give written
Local water districts 10% notice of such new or revised assessment to the
person in whose name the property is declared. The
Government-owned or 10% notice may be delivered personally or by registered
controlled corporations mail or through the assistance of the punong
engaged in the supply and barangay to the last known address of the person to
distribution of water and/or be served.
Manila Electric Company vs. City Assessor and City Held:
Assessor of Lucena
Under a BOT agreement, the proponent constructs a
Issue: Whether MERALCO is liable for real property project at its own cost. Return of investment follows,
tax on its transformers, electric posts, transmission for a time until the ownership of the facility is
lines, insulators, and electric meters beginning in transferred to a government agency.
1992?
NAPOCOR also violated Sec. 226 of the LGC
Held: While MERALCO’s property constitute taxable requiring local assessor’s prior denial of the protest
machinery; the city assessor violated former’s right to prior appealing to the Local Board Of Assessment
due process when it failed to definitively provide the Appeals
specific machineries in the notice of assessment
subject for taxation. Section 227. Organization, Powers, Duties, and
Functions of the Local Board of Assessment
Section 224. Appraisal and Assessment of Appeals. -
Machinery. -
(a) The Board of Assessment Appeals of the
(a) The fair market value of a brand-new province or city shall be composed of the
machinery shall be the acquisition cost. In all Registrar of Deeds, as Chairman, the
other cases, the fair market value shall be provincial or city prosecutor and the provincial,
determined by dividing the remaining or city engineer as members, who shall serve
economic life of the machinery by its as such in an ex officio capacity without
estimated economic life and multiplied by the additional compensation.
replacement or reproduction cost.
(b) The chairman of the Board shall have the
(b) If the machinery is imported, the power to designate any employee of the
acquisition cost includes freight, insurance, province or city to serve as secretary to the
bank and other charges, brokerage, arrastre Board also without additional compensation.
and handling, duties and taxes, plus charges
at the present site. The cost in foreign (c) The chairman and members of the Board
currency of imported machinery shall be of Assessment Appeals of the province or city
converted to peso cost on the basis of foreign shall assume their respective positions without
currency exchange rates as fixed by the need of further appointment or special
Central Bank. designations immediately upon effectivity of
this Code. They shall take oath or affirmation
Section 225. Depreciation Allowance for Machinery. - of office in the prescribed form.
For purposes of assessment, a depreciation
allowance shall be made for machinery at a rate not (d) In provinces and cities without a provincial
exceeding five percent (5%) of its original cost or its or city engineer, the district engineer shall
replacement or reproduction cost, as the case may serve as member of the Board. In the absence
be, for each year of use: Provided, however, That the of the Registrar of Deeds, or the provincial or
remaining value for all kinds of machinery shall be city prosecutor, or the provincial or city
fixed at not less than twenty percent (20%) of such engineer, or the district engineer, the persons
original, replacement, or reproduction cost for so long performing their duties, whether in an acting
as the machinery is useful and in operation. capacity or as a duly designated officer-in-
charge, shall automatically become the
CHAPTER III chairman or member, respectively, of the said
Assessment Appeals Board, as the case may be.

Section 226. Local Board of Assessment Appeals. - Section 228. Meetings and Expenses of the Local
Any owner or person having legal interest in the Board of Assessment Appeals. -
property who is not satisfied with the action of the
provincial, city or municipal assessor in the (a) The Board of Assessment Appeals of the
assessment of his property may, within sixty (60) days province or city shall meet once a month and
from the date of receipt of the written notice of as often as may be necessary for the prompt
assessment, appeal to the Board of Assessment disposition of appealed cases. No member of
Appeals of the provincial or city by filing a petition the Board shall be entitled to per diems or
under oath in the form prescribed for the purpose, traveling expenses for his attendance in Board
together with copies of the tax declarations and such meetings, except when conducting an ocular
affidavits or documents submitted in support of the inspection in connection with a case under
appeal. appeal.

National Power Corporation vs. Province of Quezon (b) All expenses of the Board shall be charged
against the general fund of the province or
Issue: Is NAPOCOR liable for real property tax city, as the case may be. The sanggunian
assessed against Mirant Pagbilao Corporation with concerned shall appropriate the necessary
whom it entered a Build Operate Transfer funds to enable the Board in their respective
Agreement? localities to operate effectively.
Section 229. Action by the Local Board of appointment. The chairman of the Board of
Assessment Appeals. - Assessment Appeals shall have the salary grade
equivalent to the rank of Director III under the Salary
(a) The Board shall decide the appeal within Standardization Law exclusive of allowances and
one hundred twenty (120) days from the date other emoluments. The members of the Board shall
of receipt of such appeal. The Board, after have the salary grade equivalent to the rank of
hearing, shall render its decision based on Director II under the Salary Standardization Law
substantial evidence or such relevant exclusive of allowances and other emoluments. The
evidence on record as a reasonable mind Board shall have appellate jurisdiction over all
might accept as adequate to support the assessment cases decided by the Local Board of
conclusion. Assessment Appeals.

(b) In the exercise of its appellate jurisdiction, There shall be Hearing Officers to be appointed by the
the Board shall have the power to summon Central Board of Assessment Appeals pursuant to
witnesses, administer oaths, conduct ocular civil service laws, rules and regulations, one each for
inspection, take depositions, and issue Luzon, Visayas and Mindanao, who shall hold office in
subpoena and subpoena duces tecum. The Manila, Cebu City and Cagayan de Oro City,
proceedings of the Board shall be conducted respectively, and who shall serve for a term of six (6)
solely for the purpose of ascertaining the facts years, without reappointment until their successors
without necessarily adhering to technical rules have been appointed and qualified. The Hearing
applicable in judicial proceedings. Officers shall have the same qualifications as that of
the Judges of the Municipal Trial Courts.
(c) The secretary of the Board shall furnish the
owner of the property or the person having The Central Board Assessment Appeals, in the
legal interest therein and the provincial or city performance of its powers and duties, may establish
assessor with a copy of the decision of the and organize staffs, offices, units, prescribe the titles,
Board. In case the provincial or city assessor functions and duties of their members and adopt its
concurs in the revision or the assessment, it own rules and regulations.
shall be his duty to notify the owner of the
property or the person having legal interest Unless otherwise provided by law, the annual
therein of such fact using the form prescribed appropriations for the Central Board of Assessment
for the purpose. The owner of the property or Appeals shall be included in the budget of the
the person having legal interest therein or the Department of Finance in the corresponding General
assessor who is not satisfied with the decision Appropriations Act.
of the Board, may, within thirty (30) days after
receipt of the decision of said Board, appeal to Montenegro vs. Commission on Audit
the Central Board of Assessment Appeals, as
herein provided. The decision of the Central Held: [on the propriety of continuing service
Board shall be final and executory. notwithstanding reaching the compulsory retirement
age]
National Power Corporation vs. Municipal
Government of Navotas: A Resolution of the CSC granting the extension is
required
Issue: Should NPC be held liable for real property
taxes on the gas turbines involved in a BOT Section 231. Effect of Appeal on the Payment of Real
agreement with Mirant Navotas I Corporation Property Tax. - Appeal on assessments of real
property made under the provisions of this Code shall,
Held: in no case, suspend the collection of the
corresponding realty taxes on the property involved as
Appeals heard before the Local Board of Assessment assessed by the provincial or city assessor, without
Appeals refer only to questions of fact; questions of prejudice to subsequent adjustment depending upon
law (i.e., authority of the assessor to make the the final outcome of the appeal.
assessment) is addressed by judicial action
Mactan Cebu International Airport Authority vs.
Section 230. Central Board of Assessment Appeals. - Marcos
The Central Board of Assessment Appeals shall be
composed of a chairman, and two (2) members to be Issue: Should MCIAA be charged with real property
appointed by the President, who shall serve for a term taxes notwithstanding the fact that both its franchise
of seven (7) years, without reappointment. Of those and its nature as a government instrumentality grants
first appointed, the chairman shall hold office for such exemption
seven (7) years, one member for five (5) years, and
the other member for three (3) years. Appointment to Held: Sec. 234 of the LGC withdraws previous
any vacancy shall be only for the unexpired portion of exemptions granted to natural and juridical persons,
the term of the predecessor. In no case shall any including government owned and controlled
member be appointed or designated in a temporary or corporations from payment of real property tax
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
John Hay Peoples Alternative Coalition vs. Lim Held: A government instrumentality exercising
corporate powers is not liable for the payment of real
Held: Proclamation No. 420 (granting tax exemption property taxes on its properties unless it is alleged
to Camp John Hay) would circumvent the and proven that the beneficial use of its properties has
Constitution’s imposition that a law granting any tax been extended to a taxable person
exemption must have the concurrence of the majority
of all members of Congress. National Power Corporation vs. the Province of
Pangasinan
Philippine Ports Authority vs. City of Iloilo
Held: Tax exemptions and privileges claimed by NPC
Issue: Should PPA be held liable for real property tax cannot be recognized since it is not the actual, direct,
(now a matter of redemption) and exclusive user of the facilities, machinery, and
equipment subject of the cases (i.e., Sual Coal-Fire
Held: Yes Thermal Power Plant pursuant to an Energy
Conversion Agreement with Mirant Sual Corporation)
1. Tax exemptions previously granted were
withdrawn under the LGC Privatization and Management Office vs. CA
a. Sec. 193
b. Sec. 534(f) [general repealing clause] Held: Though petitioners are liable for real property
2. The facilities maintained forms part of the tax because Leyte Park Hotel Inc. is leased to
patrimonial property of the state, hence Unimaster Conglomeration Inc., its appeal of the
taxable assessment no longer needs the surety bond as
condition precedent. The true party subject of the
City Government of Quezon City vs. Bayan assessment is the government, and it is always
Telecommunications Inc. presumed solvent.

Held: Respondent tax exemption privilege was briefly University of the Philippines vs. City Treasurer of
withdrawn with the passage of the LGC (Sec. 234); Quezon City
however, it was restored with the amendment of its
franchise (RA 3259 as amended by RA 7663) Held:

Tax exemption here refers only to properties used in Under RA 9500, the parcel of land owned by UP
the pursuit of the franchise currently leased to Ayala Land Inc. is exempt from
real property tax. This tax exemption, however,
City of Pasig vs. Republic of the Philippines applies only to “assets of the University of the
Philippines,” referring to assets owned by UP. Under
the Contract of Lease between UP and ALI, all
Held: LGC imposes liability to pay real estate tax on
improvement on the leased land “shall be owned by,
the Republic of the Philippines for the portions of the
and shall be for the account of the LESSEE [ALI]
properties leased to taxable entities.
during the term of the lease. The improvements are
not “assets owned by UP; and thus, UP’s tax
Republic of the Philippines vs. City of Parañaque exemption under RA 9500 does not extend to these
improvements during the term of the lease.
Held: Sec. 234 of the LGC must be read in relation to
Sec. 133(o), prohibiting the levy of taxes, fees, and CHAPTER IV
charges of any kind against the National Imposition of Real Property Tax
Government…and local government units
Section 232. Power to Levy Real Property Tax. - A
City of Lapu-Lapu vs. Philippine Economic Zone province or city or a municipality within the
Authority Metropolitan Manila Area my levy an annual ad
valorem tax on real property such as land, building,
Held: the PEZA is an instrumentality of the national machinery, and other improvement not hereinafter
government. Furthermore, the lands owned by the specifically exempted.
PEZA are real properties owned by the Republic of
the Philippines. The City of Lapu-Lapu and the Section 233. Rates of Levy. - A province or city or a
Province of Bataan cannot collect real property taxes municipality within the Metropolitan Manila Area shall
from PEZA fix a uniform rate of basic real property tax applicable
to their respective localities as follows:
Note: Notwithstanding the lease of government
property to private persons, Sec. 24 of the Special (a) In the case of a province, at the rate not
Economic Zone Act of 1995 bars taxation on business exceeding one percent (1%) of the assessed
establishments operating within economic zones value of real property; and

Metropolitan Waterworks Sewerage System vs. LGU (b) In the case of a city or a municipality within
of Quezon City the Metropolitan Manila Area, at the rate not
exceeding two percent (2%) of the assessed
value of real property.
Section 234. Exemptions from Real Property Tax. - permanent or perennial crops with at least fifty
The following are exempted from payment of the real (50) trees to a hectare shall not be considered
property tax: idle lands. Lands actually used for grazing
purposes shall likewise not be considered idle
(a) Real property owned by the Republic of lands.
the Philippines or any of its political
subdivisions except when the beneficial use (b) Lands, other than agricultural, located in a
thereof has been granted, for consideration or city or municipality, more than one thousand
otherwise, to a taxable person; (1,000) square meters in area one-half (1/2) of
which remain unutilized or unimproved by the
(b) Charitable institutions, churches, owner of the property or person having legal
parsonages or convents appurtenant thereto, interest therein.
mosques, non-profit or religious cemeteries
and all lands, buildings, and improvements Regardless of land area, this Section shall likewise
actually, directly, and exclusively used for apply to residential lots in subdivisions duly approved
religious, charitable or educational purposes; by proper authorities, the ownership of which has
been transferred to individual owners, who shall be
(c) All machineries and equipment that are liable for the additional tax: Provided, however, That
actually, directly and exclusively used by local individual lots of such subdivisions, the ownership of
water districts and government owned or which has not been transferred to the buyer shall be
controlled corporations engaged in the supply considered as part of the subdivision, and shall be
and distribution of water and/or generation subject to the additional tax payable by subdivision
and transmission of electric power; owner or operator.

(d) All real property owned by duly registered Section 238. Idle Lands Exempt from Tax. - A
cooperatives as provided for under R.A. No. province or city or a municipality within the
6938; and Metropolitan Manila Area may exempt idle lands from
the additional levy by reason of force majeure, civil
(e) Machinery and equipment used for disturbance, natural calamity or any cause or
pollution control and environmental protection. circumstance which physically or legally prevents the
owner of the property or person having legal interest
therein from improving, utilizing or cultivating the
Except as provided herein, any exemption
same.
from payment of real property tax previously
granted to, or presently enjoyed by, all
persons, whether natural or juridical, including Section 239. Listing of Idle Lands by the Assessor. -
all government-owned or controlled The provincial, city or municipal assessor shall make
corporations are hereby withdrawn upon the and keep an updated record of all idle lands located
effectivity of this Code. 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
CHAPTER V
treasurer who shall notify, on the basis of such record,
Special Levies on Real Property
the owner of the property or person having legal
interest therein of the imposition of the additional tax.
Section 235. Additional Levy on Real Property for the
Special Education Fund. - A province or city, or a
Section 240. Special Levy by Local Government
municipality within the Metropolitan Manila Area, may
Units. - A province, city or municipality may impose a
levy and collect an annual tax of one percent (1%) on
special levy on the lands comprised within its
the assessed value of real property which shall be in
territorial jurisdiction specially benefited by public
addition to the basic real property tax. The proceeds
works projects or improvements funded by the local
thereof shall exclusively accrue to the Special
government unit concerned: Provided, however, That
Education Fund (SEF).
the special levy shall not exceed sixty percent (60%)
of the actual cost of such projects and improvements,
Section 236. Additional Ad Valorem Tax on Idle including the costs of acquiring land and such other
Lands. - A province or city, or a municipality within the real property in connection therewith: Provided,
Metropolitan Manila Area, may levy an annual tax on further, That the special levy shall not apply to lands
idle lands at the rate not exceeding five percent (5%) exempt from basic real property tax and the
of the assessed value of the property which shall be in remainder of the land portions of which have been
addition to the basic real property tax. donated to the local government unit concerned for
the construction of such projects or improvements.
Section 237. Idle Lands, Coverage. - For purposes of
real property taxation, idle lands shall include the Section 241. Ordinance Imposing a Special Levy. - A
following: tax ordinance imposing a special levy shall describe
with reasonable accuracy the nature, extent, and
(a) Agricultural lands, more than one (1) location of the public works projects or improvements
hectare in area, suitable for cultivation, to be undertaken, state the estimated cost thereof,
dairying, inland fishery, and other agricultural specify the metes and bounds by monuments and
uses, one-half (1/2) of which remain lines and the number of annual installments for the
uncultivated or unimproved by the owner of payment of the special levy which in no case shall be
the property or person having legal interest less than five (5) nor more than ten (10) years. The
therein. Agricultural lands planted to sanggunian concerned shall not be obliged, in the
apportionment and computation of the special levy, to Section 248. Assessor to Furnish Local Treasurer
establish a uniform percentage of all lands subject to with Assessment Roll. - The provincial, city or
the payment of the tax for the entire district, but it may municipal assessor shall prepare and submit to the
fix different rates for different parts or sections thereof, treasurer of the local government unit, on or before
depending on whether such land is more or less the thirty-first (31st) day of December each year, an
benefited by proposed work. assessment roll containing a list of all persons whose
real properties have been newly assessed or
Section 242. Publication of Proposed Ordinance reassessed and the values of such properties.
Imposing a Special Levy. - Before the enactment of
an ordinance imposing a special levy, the sanggunian Section 249. Notice of Time for Collection of Tax. -
concerned shall conduct a public hearing thereon; The city or municipal treasurer shall, on or before the
notify in writing the owners of the real property to be thirty-first (31st) day of January each year, in the case
affected or the persons having legal interest therein of the basic real property tax and the additional tax for
as to the date and place thereof and afford the latter the Special Education Fund (SEF) or any other date
the opportunity to express their positions or objections to be prescribed by the sanggunian concerned in the
relative to the proposed ordinance. case of any other tax levied under this title, post the
notice of the dates when the tax may be paid without
Section 243. Fixing the Amount of Special Levy. - interest at a conspicuous and publicly accessible
The special levy authorized herein shall be place at the city or municipal hall. Said notice shall
apportioned, computed, and assessed according to likewise be published in a newspaper of general
the assessed valuation of the lands affected as shown circulation in the locality once a week for two (2)
by the books of the assessor concerned, or its current consecutive weeks.
assessed value as fixed by said assessor if the
property does not appear of record in his books. Upon Section 250. Payment of Real Property Taxes in
the effectivity of the ordinance imposing special levy, Installments. - The owner of the real property or the
the assessor concerned shall forthwith proceed to person having legal interest therein may pay the basic
determine the annual amount of special levy real property tax and the additional tax for Special
assessed against each parcel of land comprised Education Fund (SEF) due thereon without interest in
within the area especially benefited and shall send to four (4) equal installments; the first installment to be
each landowner a written notice thereof by mail, due and payable on or before March Thirty-first (31st);
personal service or publication in appropriate cases. the second installment, on or before June Thirty (30);
the third installment, on or before September Thirty
Section 244. Taxpayer's Remedies Against Special (30); and the last installment on or before December
Levy. - Any owner of real property affected by a Thirty-first (31st), except the special levy the payment
special levy or any person having a legal interest of which shall be governed by ordinance of the
therein may, upon receipt of the written notice of sanggunian concerned.
assessment of the special levy, avail of the remedies
provided for in Chapter 3, Title Two, Book II of this The date for the payment of any other tax imposed
Code. under this Title without interest shall be prescribed by
the sanggunian concerned.
Section 245. Accrual of Special Levy. - The special
levy shall accrue on the first day of the quarter next Payments of real property taxes shall first be applied
following the effectivity of the ordinance imposing to prior years delinquencies, interests, and penalties,
such levy. lawphil.net if any, and only after said delinquencies are settled
may tax payments be credited for the current period.
CHAPTER VI
Collection of Real Property Tax Section 251. Tax Discount for Advanced Prompt
Payment. - If the basic real property tax and the
Section 246. Date of Accrual of Tax. - The real additional tax accruing to the Special Education Fund
property tax for any year shall accrue on the first day (SEF) are paid in advance in accordance with the
of January and from that date it shall constitute a lien prescribed schedule of payment as provided under
on the property which shall be superior to any other Section 250, the sanggunian concerned may grant a
lien, mortgage, or encumbrance of any kind discount not exceeding twenty percent (20%) of the
whatsoever, and shall be extinguished only upon the annual tax due.
payment of the delinquent tax.
Section 252. Payment Under Protest. -
Section 247. Collection of Tax. - The collection of the
real property tax with interest thereon and related (a) No protest shall be entertained unless the
expenses, and the enforcement of the remedies taxpayer first pays the tax. There shall be
provided for in this Title or any applicable laws, shall annotated on the tax receipts the words "paid
be the responsibility of the city or municipal treasurer under protest". The protest in writing must be
concerned. filed within thirty (30) days from payment of
the tax to the provincial, city treasurer or
The city or municipal treasurer may deputize the municipal treasurer, in the case of a
barangay treasurer to collect all taxes on real property municipality within Metropolitan Manila Area,
located in the barangay: Provided, That the barangay who shall decide the protest within sixty (60)
treasurer is properly bonded for the purpose: days from receipt.
Provided, further, That the premium on the bond shall
be paid by the city or municipal government
concerned.
 (b) The tax or a portion thereof paid under any time before the distraint of personal
protest, shall be held in trust by the treasurer property, payment of the tax with surcharges,
concerned. interests and penalties may be made in
accordance with the next following Section,
(c) In the event that the protest is finally and unless the tax, surcharges and penalties
decided in favor of the taxpayer, the amount are paid before the expiration of the year for
or portion of the tax protested shall be which the tax is due except when the notice of
refunded to the protestant, or applied as tax assessment or special levy is contested
credit against his existing or future tax liability. administratively or judicially pursuant to the
provisions of Chapter 3, Title II, Book II of this
(d) In the event that the protest is denied or Code, the delinquent real property will be sold
upon the lapse of the sixty day period at public auction, and the title to the property
prescribed in subparagraph (a), the taxpayer will be vested in the purchaser, subject,
may avail of the remedies as provided for in however, to the right of the delinquent owner
Chapter 3, Title II, Book II of this Code. of the property or any person having legal
interest therein to redeem the property within
one (1) year from the date of sale.
Ty vs. Trampe: supra.
Section 255. Interests on Unpaid Real Property Tax. -
Camp John Hay Development Corporation vs. Central
In case of failure to pay the basic real property tax or
Board of Assessment Appeals
any other tax levied under this Title upon the
expiration of the periods as provided in Section 250,
Held: Perfecting an appeal of the assessment may by or when due, as the case may be, shall subject the
the local assessor taxpayer to the payment of interest at the rate of two
percent (2%) per month on the unpaid amount or a
1. Pay the assessed tax under protest fraction thereof, until the delinquent tax shall have
2. File the protest to the assessor within 30 days been fully paid: Provided, however, That in no case
from payment; decided in 60 days shall the total interest on the unpaid tax or portion
3. Aggrieved party files an appeal to the LBAA thereof exceed thirty-six (36) months.
4. Aggrieved party files a notice of appeal with
the CBAA Section 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
Section 253. Repayment of Excessive Collections. - remedies by administrative action thru levy on real
When an assessment of basic real property tax, or property or by judicial action.
any other tax levied under this Title, is found to be
illegal or erroneous and the tax is accordingly reduced Section 257. Local Governments Lien. - The basic
or adjusted, the taxpayer may file a written claim for real property tax and any other tax levied under this
refund or credit for taxes and interests with the Title constitutes a lien on the property subject to tax,
provincial or city treasurer within two (2) years from superior to all liens, charges or encumbrances in favor
the date the taxpayer is entitled to such reduction or of any person, irrespective of the owner or possessor
adjustment. thereof, enforceable by administrative or judicial
action, and may only be extinguished upon payment
The provincial or city treasurer shall decide the claim of the tax and the related interests and expenses.
for tax refund or credit within sixty (60) days from
receipt thereof. In case the claim for tax refund or Section 258. Levy on Real Property. - After the
credit is denied, the taxpayer may avail of the expiration of the time required to pay the basic real
remedies as provided in Chapter 3, Title II, Book II of property tax or any other tax levied under this Title,
this Code. real property subject to such tax may be levied upon
through the issuance of a warrant on or before, or
Section 254. Notice of Delinquency in the Payment of simultaneously with, the institution of the civil action
the Real Property Tax. - for the collection of the delinquent tax. The provincial
or city treasurer, or a treasurer of a municipality within
(a) When the real property tax or any other tax the Metropolitan Manila Area, as the case may be,
imposed under this Title becomes delinquent, when issuing a warrant of levy shall prepare a duly
the provincial, city or municipal treasurer shall authenticated certificate showing the name of the
immediately cause a notice of the delinquency delinquent owner of the property or person having
to be posted at the main hall and in a publicly legal interest therein, the description of the property,
accessible and conspicuous place in each the amount of the tax due and the interest thereon.
barangay of the local government unit The warrant shall operate with the force of a legal
concerned. The notice of delinquency shall execution throughout the province, city or a
also be published once a week for two (2) municipality, within the Metropolitan Manila Area. The
consecutive weeks, in a newspaper of general warrant shall be mailed to or served upon the
circulation in the province, city, or municipality. delinquent owner of the real property or person having
legal interest therein, or in case he is out of the
(b) Such notice shall specify the date upon country or cannot be located, the administrator or
which the tax became delinquent and shall occupant of the property. At the same time, written
state that personal property may be distrained notice of the levy with the attached warrant shall be
to effect payment. It shall likewise state that mailed to or served upon the assessor and the
Registrar of Deeds of the province, city or municipality Salva vs. Magpile
within the Metropolitan Manila Area where the
property is located, who shall annotate the levy on the Held: How to prove the validity of the proceedings of
tax declaration and certificate of title of the property, tax delinquency:
respectively.
1. Prove the posting and publication of notice of
The levying officer shall submit a report on the levy to tax delinquency—i.e., affidavit of publication
the sanggunian concerned within ten (10) days after by the publisher, and the newspaper issues
receipt of the warrant by the owner of the property or 2. Prove that the notice was properly mailed to
person having legal interest therein. the taxpayer’s actual address—i.e., registry
return card
Section 259. Penalty for Failure to Issue and Execute 3. Prove that the taxpayer received the warrant
Warrant. - Without prejudice to criminal prosecution of levy
under the Revised Penal Code and other applicable
laws, any local treasurer or his deputy who fails to Solco vs. Megaworld Corporation
issue or execute the warrant of levy within one (1)
year from the time the tax becomes delinquent or Held:
within thirty (30) days from the date of the issuance
thereof, or who is found guilty of abusing the exercise
A warrant of levy required by law is void when:
thereof in an administrative or judicial proceeding
shall be dismissed from the service.
a. Its acknowledgement does not
indicate the taxpayer’s signature (i..e.,
Section 260. Advertisement and Sale. - Within thirty
not mailed)
(30) days after service of the warrant of levy, the local
b. Its date of issue is also the date of the
treasurer shall proceed to publicly advertise for sale or
auction sale
auction the property or a usable portion thereof as
c. Notice of levy is not attached therein
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 Cruz vs. City of Makati
provincial, city or municipal building, and in a publicly
accessible and conspicuous place in the barangay Held: Requirements of a valid auction sale to satisfy
where the real property is located, and by publication tax delinquency
once a week for two (2) weeks in a newspaper of
general circulation in the province, city or municipality 1. Prove that taxpayer received the notice of levy
where the property is located. The advertisement shall 2. Prove that the notice of delinquency was
specify the amount of the delinquent tax, the interest posted
due thereon and expenses of sale, the date and place
of sale, the name of the owner of the real property or Absence of the requisite notice is tantamount to the
person having legal interest therein, and a description violation of taxpayer’s substantive right to due process
of the property to be sold. At any time before the date
fixed for the sale, the owner of the real property or Section 261. Redemption of Property Sold. - Within
person having legal interest therein may stay the one (1) year from the date of sale, the owner of the
proceedings by paying the delinquent tax, the interest delinquent real property or person having legal
due thereon and the expenses of sale. The sale shall interest therein, or his representative, shall have the
be held either at the main entrance of the provincial, right to redeem the property upon payment to the
city or municipal building, or on the property to be local treasurer of the amount of the delinquent tax,
sold, or at any other place as specified in the notice of including the interest due thereon, and the expenses
the sale. of sale from the date of delinquency to the date of
sale, plus interest of not more than two percent (2%)
Within thirty (30) days after the sale, the local per month on the purchase price from the date of sale
treasurer or his deputy shall make a report of the sale to the date of redemption. Such payment shall
to the sanggunian concerned, and which shall form invalidate the certificate of sale issued to the
part of his records. The local treasurer shall likewise purchaser and the owner of the delinquent real
prepare and deliver to the purchaser a certificate of property or person having legal interest therein shall
sale which shall contain the name of the purchaser, a be entitled to a certificate of redemption which shall
description of the property sold, the amount of the be issued by the local treasurer or his deputy.
delinquent tax, the interest due thereon, the expenses
of sale and a brief description of the proceedings: From the date of sale until the expiration of the period
Provided, however, That proceeds of the sale in of redemption, the delinquent real property shall
excess of the delinquent tax, the interest due thereon, remain in possession of the owner or person having
and the expenses of sale shall be remitted to the legal interest therein who shall be entitled to the
owner of the real property or person having legal income and other fruits thereof.
interest therein.
The local treasurer or his deputy, upon receipt from
The local treasurer may, by ordinance duly approved, the purchaser of the certificate of sale, shall forthwith
advance an amount sufficient to defray the costs of return to the latter the entire amount paid by him plus
collection thru the remedies provided for in this Title, interest of not more than two percent (2%) per month.
including the expenses of advertisement and sale. Thereafter, the property shall be free from lien of such
delinquent tax, interest due thereon and expenses of
sale.
City Mayor vs. Rizal Commercial Banking Corporation deposited shall be paid to the purchaser at the auction
sale if the deed is declared invalid but it shall be
Held: The counting of the 1 year redemption period of returned to the depositor if the action fails.
property sold at public auction for its tax delinquency
should be counted from the date the annotation of the Neither shall any court declare a sale at public auction
certificate of sale in the Register of Deeds invalid by reason or irregularities or informalities in the
proceedings unless the substantive rights of the
Section 262. Final Deed to Purchaser. - In case the delinquent owner of the real property or the person
owner or person having legal interest fails to redeem having legal interest therein have been impaired.
the delinquent property as provided herein, the local
treasurer shall execute a deed conveying to the Gamilla vs. Burgundy Realty Corporation
purchaser said property, free from lien of the
delinquent tax, interest due thereon and expenses of Held: Sec. 267 of RA 7160 explicitly provides that a
sale. The deed shall briefly state the proceedings court shall not entertain any action assailing the of the
upon which the validity of the sale rests. sale at public auction of real property unless the
taxpayer deposits with the court the amount for which
Section 263. Purchase of Property By the Local the real property was sold, together with the interest
Government Units for Want of Bidder. - In case there of 2% per month from the date of sale to the time of
is no bidder for the real property advertised for sale as the institution of the action. This condition is a
provided herein, the real property tax and the related jurisdictional requirement, the nonpayment of which
interest and costs of sale the local treasurer warrants the dismissal of the action.
conducting the sale shall purchase the property in
behalf of the local government unit concerned to Beamount Holdings Corporation vs. Reyes
satisfy the claim and within two (2) days thereafter
shall make a report of his proceedings which shall be Held: If there is competent evidence that the realty tax
reflected upon the records of his office. It shall be the die on the property subject of the tax sale has been
duty of the Registrar of Deeds concerned upon seasonably and fully paid, then the deposit
registration with his office of any such declaration of requirement under Sec. 267 does not serve its
forfeiture to transfer the title of the forfeited property to intended purpose and ceases to be jurisdictiona;
the local government unit concerned without the
necessity of an order from a competent court.
Section 268. Payment of Delinquent Taxes on
Property Subject of Controversy. - In any action
Within one (1) year from the date of such forfeiture, involving the ownership or possession of, or
the taxpayer or any of his representative, may redeem succession to, real property, the court may, motu
the property by paying to the local treasurer the full propio or upon representation of the provincial, city, or
amount of the real property tax and the related municipal treasurer or his deputy, award such
interest and the costs of sale. If the property is not ownership, possession, or succession to any party to
redeemed as provided herein, the ownership thereof the action upon payment to the court of the taxes with
shall be vested on the local government unit interest due on the property and all other costs that
concerned. may have accrued, subject to the final outcome of the
action.
Section 264. Resale of Real Estate Taken for Taxes,
Fees, or Charges. - The sanggunian concerned may, Section 269. Treasurer to Certify Delinquencies
by ordinance duly approved, and upon notice of not Remaining Uncollected. - The provincial, city or
less than twenty (20) days, sell and dispose of the municipal treasurer or their deputies shall prepare a
real property acquired under the preceding section at certified list of all real property tax delinquencies
public auction. The proceeds of the sale shall accrue which remained uncollected or unpaid for at least one
to the general fund of the local government unit (1) year in his jurisdiction, and a statement of the
concerned. reason or reasons for such non-collection or non-
payment, and shall submit the same to the
Section 265. Further Distraint or Levy. - Levy may be sanggunian concerned on or before December thirty-
repeated if necessary until the full amount due, first (31st) of the year immediately succeeding the
including all expenses, is collected. year in which the delinquencies were incurred, with a
request for assistance in the enforcement of the
Section 266. Collection of Real Property Tax Through remedies for collection provided herein.
the Courts. - The local government unit concerned
may enforce the collection of the basic real property Section 270. Periods Within Which To Collect Real
tax or any other tax levied under this Title by civil Property Taxes. - The basic real property tax and any
action in any court of competent jurisdiction. The civil other tax levied under this Title shall be collected
action shall be filed by the local treasurer within the within five (5) years from the date they become due.
period prescribed in Section 270 of this Code. No action for the collection of the tax, whether
administrative or judicial, shall be instituted after the
Section 267. Action Assailing Validity of Tax Sale. - expiration of such period. In case of fraud or intent to
No court shall entertain any action assailing the evade payment of the tax, such action may be
validity or any sale at public auction of real property or instituted for the collection of the same within ten (10)
rights therein under this Title until the taxpayer shall years from the discovery of such fraud or intent to
have deposited with the court the amount for which evade payment.
the real property was sold, together with interest of
two percent (2%) per month from the date of sale to The period of prescription within which to collect shall
the time of the institution of the action. The amount so be suspended for the time during which:
 (1) The local treasurer is legally prevented of the municipality where the property
from collecting the tax; is located;

(2) The owner of the property or the person (3) Barangays - Thirty percent (30%)
having legal interest therein requests for shall be distributed among the
reinvestigation and executes a waiver in component barangays of the
writing before the expiration of the period municipality where the property is
within which to collect; and located in the following manner:

(3) The owner of the property or the person (i) Fifty percent (50%) shall
having legal interest therein is out of the accrue to the barangay where
country or otherwise cannot be located. the property is located;

CHAPTER VII (ii) Fifty percent (50%) shall

Disposition of Proceeds accrue equally to all
component barangays of the
Section 271. Distribution of Proceeds. - The proceeds municipality.
of the basic real property tax, including interest
thereon, and proceeds from the use, lease or (d) The share of each barangay shall be
disposition, sale or redemption of property acquired at released, without need of any further action,
a public auction in accordance with the provisions of directly to the barangay treasurer on a
this Title by the province or city or a municipality quarterly basis within five (5) days after the
within the Metropolitan Manila Area shall be end of each quarter and shall not be subject to
distributed as follows: any lien or holdback for whatever purpose.

(a) In the case of provinces: Section 272. Application of Proceeds of the

Additional One Percent SEF Tax. - The proceeds from
(1) Province - Thirty-five percent the additional one percent (1%) tax on real property
(35%) shall accrue to the general accruing to the Special Education Fund (SEF) shall be
fund; automatically released to the local school boards:
Provided, That, in case of provinces, the proceeds
(2) Municipality - Forty percent (40%) shall be divided equally between the provincial and
to the general fund of the municipality municipal school boards: Provided, however, That the
where the property is located; and proceeds shall be allocated for the operation and
maintenance of public schools, construction and
repair of school buildings, facilities and equipment,
(3) Barangay - Twenty-five percent
educational research, purchase of books and
(25%) shall accrue to the barangay
periodicals, and sports development as determined
where the property is located.
and approved by the Local School Board.
(b) In the case of cities:
Province of Camarines Sur vs. Commission on Audit
(1) City - Seventy percent (70%) shall
Held: The authority to expend the Special Education
accrue to the general fund of the city;
Fund for the operation and maintenance of extension
and
classes of public schools carries with it the authority to
utilize the SEF not only for the salaries and allowance
(2) Thirty percent (30%) shall be of the teaching personnel, but those of the non-
distributed among the component teaching personnel alike who were hired as necessary
barangays of the cities where the and indispensable auxiliary to the teaching staff.
property is located in the following
manner:
Section 273. Proceeds of the Tax on Idle Lands. -
The proceeds of the additional real property tax on
(i) Fifty percent (50%) shall idle lands shall accrue to the respective general fund
accrue to the barangay where of the province or city where the land is located. In the
the property is located; case of a municipality within the Metropolitan Manila
Area, the proceeds shall accrue equally to the
(ii) Fifty percent (50%) shall Metropolitan Manila Authority and the municipality
accrue equally to all where the land is located.
component barangays of the
city; and Section 274. Proceeds of the Special Levy. - The
proceeds of the special levy on lands benefited by
(c) In the case of a municipality within the public works, projects and other improvements shall
Metropolitan Manila Area: accrue to the general fund of the local government
unit which financed such public works, projects or
(1) Metropolitan Manila Authority - other improvements.
Thirty-five percent (35%) shall accrue
to the general fund of the authority; CHAPTER VIII
Special Provisions
(2) Municipality - Thirty-five percent
(35% shall accrue to the general fund
Section 275. General Assessment Revision; shall be exempt from the payment of postal charges
Expenses Incident Thereto. - The sanggunian of or fees.
provinces, cities and municipalities within the
Metropolitan Manila Area shall provide the necessary Section 283. Sale and Forfeiture Before Effectivity of
appropriations to defray the expenses incident to the Code. - Tax delinquencies incurred, and sales and
general revision of real property assessment. forfeitures of delinquent real property effected, before
the effectivity of this Code shall be governed by the
All expenses incident to a general revision of real provisions of applicable laws then in force.
property assessment 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.

Section 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.

Section 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.

Section 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.

Section 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.

Section 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.

Section 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.

Section 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