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Local Governmnet
Local Governmnet
The Real Property Tax is one way of the local government to generate
revenues. It is imposed on real properties within the locality.
WHEREAS, the past decade saw the passage of the Local Autonomy
Act, the Barrio Charter, the Decentralization Act and other pieces of
legislation intended to make local governments financially self-reliant
and stable;
WHEREAS, it is very apparent that in spite of all these laws, local
governments still find difficulty in providing adequate funds with which
to underwrite basic and essential public services within their respective
areas of responsibility;
WHEREAS, studies show that one of the main reasons behind this is the
failure of local governments to fully tap the income potentialities of the
real property tax;
Section 40. Exemptions from Real Property Tax. — The exemption shall
be as follows:
(a) Real property owned by the Republic of the Philippines or any of its
political subdivisions and any government-owned corporation so
exempt by its charter: Provided; however, that this exemption shall not
apply to real property of the above named entities the beneficial use of
which has been granted, for consideration or otherwise, to a taxable
person.
(f) Perennial trees and plants of economic value, except where the land
upon which they grow is planted principally to such growth.
Section 86. The proceeds of the real property tax, except as otherwise
provided in this Code, shall accrue to the province, city or municipality
where the property subject to the tax is situated and shall be applied
by the respective local government unit for its own use and benefit.
Real Property Tax - Under the 1991 LGC, provinces may tax real
property at a basic rate that is not greater than 1 percent of its
assessed value while cities and Metro Manila (MM) municipalities may
impose a tax not greater than 2 percent.
Local Business Tax - Under the 1991 LGC, municipalities and cities may
levy and collect a tax on businesses on the basis of their gross
receipts/sales at rates prescribed according to a graduated schedule.