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D1 - 04 - Panel1 - ATI - Pamela P. Quizon

The Real Property Valuation and Assessment Reform Act (RPVARA) aims to modernize real property valuation and assessment in the Philippines by establishing standards, creating a unified valuation base, and developing a comprehensive electronic database. The current system suffers from outdated valuations, lack of a single responsible agency, and multiple valuation disparities, leading to revenue losses. RPVARA seeks to enhance fiscal autonomy for local government units while ensuring transparency and compliance with international standards.

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Joshua Brent
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20 views6 pages

D1 - 04 - Panel1 - ATI - Pamela P. Quizon

The Real Property Valuation and Assessment Reform Act (RPVARA) aims to modernize real property valuation and assessment in the Philippines by establishing standards, creating a unified valuation base, and developing a comprehensive electronic database. The current system suffers from outdated valuations, lack of a single responsible agency, and multiple valuation disparities, leading to revenue losses. RPVARA seeks to enhance fiscal autonomy for local government units while ensuring transparency and compliance with international standards.

Uploaded by

Joshua Brent
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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DEPARTMENT OF FINANCE

BUREAU OF LOCAL GOVERNMENT FINANCE


Improving Local Finance, Empowering Local Governments towards Sustainability

COMPREHENSIVE TAX REFORM PROGRAM

Real Property Valuation and


Assessment Reform Act (RPVARA)
(Republic Act No. 12001)

An Act Instituting Reforms in Real Property


Valuation and Assessment in the Philippines,
Reorganizing the Bureau of Local
Government Finance Granting of Tax Amnesty
on Real Property and Special Levies on Real
Property, and Appropriating Funds Therefor
WHAT IS WRONG WITH THE CURRENT SYSTEM?
• Outdated valuations used for governmental purposes, especially for national and local taxation;
LGUs comingle valuation with taxation

• Multiple valuations resulting in wide disparities in values: there are as many values as there are
valuing agencies

• Outdated valuations result in costs, foregone revenues: overvaluation when government pays,
undervaluation when government collects taxes

• No single agency responsible for ensuring that valuations/ revaluations are completed in
accordance with standards

• Absence of a comprehensive real property electronic database to capture transactions and


support regular property re-valuations

D E P A R T M E N T O F F I N A N C E | BUREAU OF LOCAL GOVERNMENT FINANCE


RPVARA aims to:
1 - Establish and
3 - Comprehensive and up-to-
maintain standards 2 - Adopt single valuation
date electronic database;
based on Philippine base for taxation; as
Promote the use of Innovative
Valuation Standards benchmark for other
digital technology
in compliance with purposes
international
valuation standards
6 - Ensure
4 - Separate the 5 - Promote the fiscal transparency in real
function of valuation autonomy property transactions
and taxation

• Prepared by Assessor
• Approved by and Under RA 12001 (RPVARA)
Department of Finance
(DOF) based on the Approved by Local Council (Sanggunian)
standards
Schedule of Fair
Assessment Level Tax Rate Tax Due
Market Value

D E P A R T M E N T O F F I N A N C E | BUREAU OF LOCAL GOVERNMENT FINANCE


Development of Real Property
Information System

RPIS The Bureau of Local Government Finance shall develop


and maintain an up-to-date electronic database of the
sale, exchange, lease, mortgage, donation, transfer and all
other real property transactions and declarations in the
country.

Duty of Register of Deeds to Supply Assessors


with Real Property Transactions Data

Transmission of Real Property


Transactions Data to the BLGF

D E P A R T M E N T O F F I N A N C E | BUREAU OF LOCAL GOVERNMENT FINANCE


Real Property in the Philippines

• Real property as major resource and potentially biggest source of own-revenues of


LGUs
• According to The World Bank: 50% to 75% of the national wealth contained in real
properties
• De Soto, in The Mystery of Capital, 2000, estimated that:
• 60% of the country's properties is dead capital amounting to US$133 B
• 57% of city dwellers and 67% of rural residents in the Philippines live in housing that is dead capital
• In 2000, the Inter-Agency Coordinating Committee recommended key structural
reforms

D E P A R T M E N T O F F I N A N C E | BUREAU OF LOCAL GOVERNMENT FINANCE


While Local Government Units focus on their political functions, RPVARA will ensure
that the Schedule of Market Values (SMVs) are reliable and in accordance with
internationally accepted valuation standards.
⇔
TECHNICAL FUNCTION P O L I T I C A L F U N C T I O N

VALUATION ASSESSMENT LEVEL TAX RATE BUDGET

Maximum levels Basic Tax ANNUAL


(percent of SMV) Maximum levels
Updated property values do not mean •Residential = 20 (percent)
higher taxes as LGUs are empowered •Agricultural = 40 •Provinces and
to adjust the assessment level and tax municipalities = 1
rate. •Commercial = 50
•Industrial = 50 •Cities = 2
•Mineral = 50 •Special educational
fund (SEF) = 1

D E P A R T M E N T O F F I N A N C E | BUREAU OF LOCAL GOVERNMENT FINANCE

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