Foreword

This subject covers the students’ knowledge of the principles and concepts of taxation and the
practical application of these principles and concepts. Students are expected to know the
National Internal Revenue Code (NIRC) provisions; the Tariff and Customs Code; Local
Government Code on local taxes; preferential tax or tax exemption provisions and taxes
pertaining to senior citizens and persons with disability, Board of Investments, PEZA, BMBE,
various Tax Treaties and other special laws and issuances that may be legislated in the future.
The students must be familiar with the Implementing Rules and Regulations, circulars, rulings
and other issuances pertinent to the implementation of the various taxation laws earlier
specified. The learners should equally know the taxation principles in the decisions of the Court
of Tax Appeals, Court of Appeals and Supreme Court.

Module 1:

Review on the Principles of Taxation

LEARNING OBJECTIVES

After completing the lesson, the students must be able to comprehend and demonstrate mastery
of the following:

 Concept of taxation and its necessity for every government

 Lifeblood doctrine and its implication to taxation
 Theories of government cost allocation
 Inherent power of the State
 Scope of the taxation power
 Limitations of the taxation power
 Stages of taxation
 Concept of situs of taxation
 Fundamental principles surrounding taxation
 Various escapes from taxation  Concept of tax amnesty and condonation  Define
taxation, tax and tax laws.
 Enumerate the types of taxation laws, administrative issuances and tax rulings.
 Identify and describe the elements of valid tax.
 Differentiate tax from revenue, license fee, toll, debt and similar items.
 Understand the nature and tax system of the Philippines.
 Discuss the principles of a sound tax system
 Identify other government agencies tasked with tax collections or tax incentives related
functions.

SALIENT POINTS FOR DISCUSSION

This module provides a review of the principles of taxation. It discusses theories and concepts
necessary for the understanding of taxation. It also explains taxation as one of the inherent
powers of the state (different from the police power and eminent domain). Furthermore, it
introduces principles and doctrines followed by the government in formulating rules and
provisions related to taxation and certain topics about tax laws, tax regulations, and tax rulings
vital for the efficient tax administration.

 Definition of Taxation
Taxation may be defined as a State power, a legislative process and government cost
distribution.

 The Theory of Taxation

Every government provides a vast array of public services including defense, public order
and safety, health, education, and social protection among others. A system of
government is indispensable to every society. Without it, the people will not relish the
benefits of a civilized and orderly society. However, the government cannot exist without
a system of funding. The government’s necessity for funding is the theory of taxation.

 The Basis of Taxation

The government provide benefits to the people in the form of public services, and the
people provide the funds that finance the government. This mutuality of support between
the people and the government is referred to as the basis of taxation.

 Theories of Cost Allocation

Taxation is the mode of allocating government costs or burden to the people. In
distributing the costs or burden, the government regards the following general
considerations in the exercise of its taxation power:

 Benefit Received Theory – presupposes that the more benefit one receives from the
government, the more taxes he should pay.

 Ability to Pay Theory – presupposes that taxation should also consider the taxpayer’s
ability to pay. Taxpayers should be required to contribute based on their relative
capacity to sacrifice for the support of the government.

 The Lifeblood Doctrine – Taxes are essential and indispensable to the continued
subsistence of the government. Without taxes, the government would be paralyzed for
lack of motive power to activate or operate it.

Taxes are the lifeblood of the government and their prompt and certain availability
are in imperious need. Upon taxation depends the government’s ability to serve the
people for whose benefit taxes are collected.

 Inherent Powers of the State

The government has its basic needs and rights which co-exist with its creation. It has
rights to sustenance, protection, and properties. These rights, dubbed as powers are
natural, inseparable, and inherent to every government. No government can sustain or
effectively operate without these powers. Thus, the exercise of these powers by the
 government is presumed, understood, and acknowledged by the people from the very
moment they establish their government.

The Inherent Powers of the State

1. Taxation Power – the power of the State to enforce proportional contribution from its
subjects to sustain itself.
2. Police Power – power of the State to enact laws to protect the well-being of its people
3. Eminent Domain Power – power of the State to take private property for public use
after paying just compensation.

 Taxation Power
 Scope of Taxation Power
The scope of taxation is widely regarded as comprehensive, plenary, unlimited and
supreme.

 The Limitations of the Taxation Power

a. Inherent Limitations
• Territoriality of Taxation
Public services are normally provided within the boundaries of the State. The
government can only demand tax obligations upon its subjects or residents
within its territorial jurisdiction.

• International Comity
No country is powerful than the other. It is by this principle that each country
observes international comity or mutual courtesy or reciprocity between them.
Hence,
 Government do not tax the income and properties of other government
 Government give primacy to their treaty obligations over their own
domestic tax laws.

• Public Purpose
Taxation must be exercised absolutely for public purpose.

• Exemption of the Government

Under NIRC, government properties and income from essential public
functions are not subject to taxation. However, income of the government
from properties and activities conducted for profit including income from
government-owned and controlled corporations is subject to tax.

• Non-delegation of the Taxing Power

The power of lawmaking, including taxation, is delegated by the people to the
legislature. So as not to spoil the purpose of delegation, it is held that what has
been delegated cannot be further delegated.
 Exceptions to the rule of non-delegation
 Under the Constitution, local government units are allowed to exercise the
power to tax to enable them to exercise their fiscal autonomy.
 Under the Tariff and Customs Code, the President is empowered to fix the
amount of tariffs to be flexible to trade conditions.
 Other cases that require expedient and effective administration and
implementation of assessment and collection of taxes.

b. Constitutional Limitations
• Due Process of law
No one should be deprived of life, liberty, or property without due process of
law. Tax laws should neither be harsh nor oppressive.

Aspects of Due Process

 Substantive due process
Tax must be imposed only for public purpose, collected only under
authority of a valid law and only by the taxing power having jurisdiction.
The assessment without a legal basis violates the requirement of due
process.

 Procedural due process

The established procedures which must be adhered to in making
assessments and in enforcing collections. The failure of the government to
observe these rules violates the requirements of due process.

• Equal Protection of the Law

No person shall be denied the equal protection of the law. Taxpayers should
be treated equally both in terms of rights conferred and obligations imposed.

• Uniformity Rule in Taxation

Taxpayers under dissimilar circumstances should not be taxed the same.
Taxpayers should be classified according to commonality in attributes, and the
tax classification to be adopted should be based on substantial distinction.
Each class is taxed differently, but taxpayers falling under the same class are
taxed the same.

• Progressive System of Taxation

Under the progressive system, tax rates increase as the tax base increases. The
Constitution favors progressive tax as it is consistent with the taxpayer’s
ability to pay. This system also aids in an equitable distribution of wealth to
society by taxing the rich more than the poor.

• Non-imprisonment for Non-payment of debt or poll tax

 No one shall be imprisoned because of his poverty and no one shall be
imprisoned for mere inability to pay debt.

Is non-payment of tax equivalent to non-payment of debt?

Non-payment of tax compromises public interest while non-payment of debt
compromises private interest. The non-payment of tax is similar to a crime.
The Constitutional guarantee on non-imprisonment for non-payment of debt
does not extend to non-payment of tax except poll tax.

Poll tax has two components: a.

Basic community tax
b. Additional community tax

The constitutional guarantee of non-imprisonment for non-payment of poll tax

applies only to the basic community tax. Non-payment of additional
community tax is an act of tax evasion punishable by imprisonment.

• Non-impairment of obligation and contract

Tax exemption granted under contract should be honored and should not be
cancelled by a unilateral government action.

• Free Worship Rule

The Philippine government adopts free exercise of religion and does not
subject its exercise to taxation. Consequently, the properties and revenues ofII
institutions such as tithes or offerings are not subject to tax.

• Exemption of religious or charitable entities, non-profit cemeteries, churches,

and mosques, lands, buildings, and improvements from property taxes The
constitutional exemption from property tax applies for properties actually,
directly, and exclusively used for charitable, religious, and educational
purposes (doctrine of use).

• Non-appropriation of public funds or property for the benefit of any church,

sect or system of religion
This constitutional limitation is intended to highlight the separation of religion
and the State. To support the freedom of religion, the government should not
favor any particular system of religion by appropriating public funds or
property in support thereof.

• Exemption from taxes of the revenues and assets of non-profit non-stock

educational institutions including grants, endowments, donations or
contributions for educational purposes
The Constitution recognizes the necessity of education in state building by
granting tax exemption on revenues and assets of non-profit educational
 institutions. This exemption, however, applies only on revenues and assets
that are actually, directly, and exclusively devoted for educational purposes.

The NIRC exempts government educational institutions from income tax and
subjects private educational institutions to a minimal 10% income tax.
• Concurrence of a majority of all members of Congress for the passage of law
granting tax exemption
The Constitution requires the vote of the majority of all members of Congress
in the grant of tax exemption, absolute majority in the approval of an
exemption law, and relative majority in the withdrawal of tax exemption.

• Non-diversification of tax collections

Tax collections should be used only for public purpose and should never be
diversified of used for private purpose.

• Non-delegation of the power of taxation

The principles of checks and balances in a republican state requires that
taxation power as part of lawmaking be vested exclusively in Congress.
However, delegation may be made on matters involving the expedient, and
effective administration and implementation of assessment and collection of
taxes. Also, certain aspects of the taxing process that are non-legislative in
character are delegated.

• Non-impairment of the jurisdiction of the supreme court to review tax cases

Notwithstanding the existence of the Court of Tax Appeals, which is a special
court, all cases involving taxes can be raised and be finally decided by the
Supreme Court of the Philippines.

• The requirement that appropriations, revenue or tariff bills shall originate

exclusively in the House of Representatives
Laws that add income to the national treasury and those that allows spending
therein must originate from the House of Representatives while Senate may
concur with amendments.

• The delegation of taxing power to local government units

This is a constitutional recognition of the local autonomy of local
governments and an express delegation of the taxing power.

 Stages of the Exercise of Taxation Power

a. Levy or Imposition
This process involves the enactment of a tax law by Congress and is called impact
of taxation. It is also called the legislative act in taxation.
 Matters of legislative discretion in the exercise of
taxation  Determining the object of taxation
 Setting the tax rate or amount to be collected
 Determining the purpose for the levy which must be public use
 Kind of tax to be imposed
 Apportionment of the tax between the national and local government
 Situs of Taxation
 Method of collection

b. Assessment and collection

Tax law is implemented by the administrative branch of the government.
Implementation involves assessment of the determination of the tax liabilities of
taxpayers and collection. This stage is referred to as incidence of taxation or the
administrative act of taxation.

 Situs of Taxation
Situs is the place of taxation. It is the tax jurisdiction that has the power to levy taxes
upon the tax object.

Example of Business Situs Rules

a. Business Tax Situs – place where the business is conducted

Income Tax Situs on:

b. Services – services where they are rendered
c. Sale of goods – place of sale

d. Property tax situs – location of the property

e. Personal tax situs – place of residence

 Other Fundamental Doctrines in Taxation

a. Marshall Doctrine – “The power to tax involves the power to destroy”.
b. Holme’s Doctrine – “Taxation power is not the power to destroy while the court
sits”.
c. Prosperity of tax laws – Tax laws are generally prospective in operations. An ex
post facto law or a law that retroacts in prohibited by the Constitution.’
d. Non-compensation or set-off – Taxes are not subject to automatic set-off or
compensation. Tax is not a debt, hence, it is not subject to set-off.
e. Non-assignment of taxes – Tax obligations cannot be assigned or transferred to
another entity by contract.
f. Impresciptibility in taxation – Prescription is the lapsing of a right due to the
passage of time. The government’s right to collect taxes does not prescribe unless
the law itself provides such prescription.
 g. Doctrine of Estoppel – Any misrepresentation made by one party toward another
who relied in good faith will be held true and binding against that person who
made the misrepresentation. The government is not subject to estoppel.
h. Judicial Non-interference – Generally, the courts are not allowed to issue
injunction against the government’s pursuit to collect tax as this would
unnecessarily defer tax collection.
i. Strict Construction of Tax Laws – When the law clearly provides for taxation,
taxation is the general rule unless there is a clear exemption. Taxation is the rule;
exemption is the exception.

Vague tax laws are construed against the government and in favor of the
taxpayers. A vague tax law means no tax law. Obligation arising from law is not
presumed. Vague tax exemption laws are construed against the taxpayer and in
favor of the government. A vague tax exemption law means no exemption law.

 Double Taxation
Double taxation occurs when the same taxpayer is taxed twice by the same tax
jurisdiction for the same thing.

Elements of Double Taxation

a. Primary element: same object
b. Secondary elements:
 Same type of tax
 Same purpose of tax
 Same taxing jurisdiction
 Same tax period

Types of Double Taxation

a. Direct double taxation – occurs when all the element of double taxation exists for
both impositions.
b. Indirect double taxation – occurs when at least one of the secondary elements of
double taxation is not common for both impositions.

How can double taxation be minimized?

Impact of double taxation can be minimized by one or a combination of the
following: a. Provision of tax exemption
b. Allowing foreign tax credit
c. Allowing reciprocal tax treatment
d. Entering into treaties or bilateral agreements

 Escapes from Taxation

Escapes from taxation are the means available to the taxpayer to limit or even avoid
the impact of taxation.
 Categories of Escapes from Taxation
A. Those that result to loss of government revenue
a. Tax Evasion – also known as tax dodging, refers to any act or trick that tends
to illegally reduce or avoid the payment of tax.
b. Tax Avoidance – also known as tax minimization, refers to any act or trick
that reduces or totally escapes taxes by any legally permissible means.
c. Tax Exemption – also known as tax holiday, refers to the immunity, privilege
or freedom from being subject to a tax which others are subject to. It may be
granted by the Constitution, law or contract.

B. Those that do not result to loss of government revenue

a. Shifting – the process of transferring tax burden to other taxpayers.
b. Capitalization – pertains to the adjustment of the value of an asset caused by
changes in tax rates.
c. Transformation – pertains to the elimination of wastes or losses by the
taxpayer to form savings to compensate for the tax imposition or increase in
taxes.

 Tax Amnesty vs. Tax Condonation

Tax Amnesty
It is a general pardon granted by the government for erring taxpayers to give them a
chance to reform and enable them to have a fresh start to be part of society with a
clean slate. It is an absolute forgiveness or waiver by the government on its right to
collect and is retrospective in application.

Tax Condonation
It is forgiveness of the tax obligation of a certain taxpayer under certain justifiable
grounds. This is referred to as tax remission.

 Taxation Law refers to any law that arises from the exercise of the taxation power of the
State.

 Types of Taxation Laws

a. Tax Laws – provide for the assessment and collection of taxes (e.g. The National
Internal Revenue Code (NIRC), The Tariff and Customs Code, The Local Tax
Code and The Real Property Tax Code)
b. Tax Exemption Laws- grant certain immunity from taxation (e.g. The Minimum
Wage Law, The Omnibus Investment Code of 1987, Barangay Micro-Business
Enterprise, Cooperative Development Act).

 Sources of Taxation Laws

a. Constitution
b. Statues and Presidential Decrees
c. Judicial Decisions or case laws
 d. Executive Orders and Batas Pambansa
e. Administrative Issuances
f. Local Ordinances
g. Tax Treaties and Conventions with foreign countries
h. Revenue Regulations

 Tax is an enforced proportional contribution levied by the lawmaking body of the State to
raise revenue for public purpose.

 Elements of a Valid Tax

1. Tax must be levied by the taxing power having jurisdiction over the object of
taxation.
2. Tax must not violate constitutional and inherent limitations.
3. Tax must be uniform and equitable.
4. Tax must be for public purpose.
5. Tax must be proportional in character.
6. Tax is generally payable in money.

 Distinction of Taxes with Similar Items

 Tax vs. Revenue
Tax refers to the amount imposed by the government for public purpose. Revenue
refers to all income collections of the government which includes taxes, tariff,
licenses, toll, penalties and others.

 Tax vs. License Fee

Tax emanates from taxation power and imposed upon any object such as persons,
properties, or privileges to raise revenue. It is imposed after the commencement of a
business or profession. License Fee emanates from police power and is imposed to
regulate the exercise of a privilege such as commencement of a business or
profession. It is imposed before the engagement in those activities.

 Tax vs. Toll

Tax is a levy of government; hence, it is demand of sovereignty. Its amount depends
upon the need of the government. Toll is a charge for the use of other’s property;
hence, it is demand of ownership. Its amount is dependent upon the value of the
property leased.

 Tax vs. Debt

Tax arises from law while debt arises from private contracts. Non-payments of tax
leads to imprisonment. Debt can be subject to set-off but tax is not. Debt can be paid
in kind but tax is generally payable in money. Tax draws interest only when the
taxpayer is delinquent while debt draws interest when it is so stipulated by the
contracting parties or when the debtor incurs legal delay.
  Tax vs. Special Assessment
Tax is an amount imposed upon persons, properties, or privileges. Special assessment
is levied by the government on lands adjacent to a public improvement. The basis of
special assessment is the benefit in terms of the appreciation in land value caused by
the public improvement while tax is levied without expectation of a direct proximate
benefit. Special assessment attaches to land only and will not become a personal
obligation of the land owner. Non-payment of special assessment will not result to
imprisonment of the land owner, unlike non-payment of taxes.
 Tax vs. Tariff
Tax is an amount imposed upon persons, privilege, transactions or properties while
tariff is the amount imposed on imported or exported commodities.

 Tax vs. Penalty

Tax is an amount imposed for the support of the government while penalty is an
amount imposed to discourage an act.

 Tax System
The tax system refers to the methods or schemes of imposing, assessing and collecting
taxes. It includes all tax laws, and regulations, the means of their enforcement, and the
government offices, bureaus and withholding agents which are part of the machineries of
the government in tax collection. The Philippine tax system is divided into two: national
tax system and local tax system.

 Types of Tax Systems According to Imposition

a. Progressive – income taxation as well as transfers of properties of individuals
b. Proportional – taxation of corporate income and business
c. Regressive – not employed in the Philippines

 Types of Tax System According to Impact

a. Progressive System – emphasize direct taxes that cannot be shifted. It impacts
more upon the rich.
b. Regressive System – emphasizes indirect taxes and be shifted by businesses to
consumers. It impacts the bottom end of the society and is anti-poor.

 Principles of A Sound Tax System

According to Adam Smith, the government should adhere to the following principles of a
sound tax system:
 Fiscal Adequacy – requires that the source of government funds must be sufficient to
cover government costs.
 Theoretical Justice or equity – suggests that taxation should consider the taxpayers’
ability to pay.
 Administrative Feasibility – suggests that tax laws should be capable of efficient and
effective administration to encourage compliance.
  Agents and Deputies for Collection of National Internal Revenue Taxes
The following are agents for the collection of internal revenue taxes
a. Commissioner of Customs and his subordinates with respect to collection of
national internal revenue taxes on imported goods
b. The head of appropriate government offices and his subordinates with respect to
the collection of energy tax
c. Banks duly accredited by the Commissioner with respect to receipts of payments
of internal revenue taxes authorized to be made thru banks (also called Authorized
Government Depository Banks (AGDB)).

 Other Agencies Tasked with Tax Collections or Tax Incentives Related Functions
 Bureau of Customs – tasked to administer collection of tariffs on imported articles
and collection of the Value Added Tax on Importation.

 Board of Investments – tasked to lead the promotion of investments in the Philippines

by assisting Filipinos and foreign investors to venture and prosper in desirable areas
of economic activities. It supervises the grant of tax incentives under the Omnibus
Investment Code.

 Philippine Economic Zone Authority (PEZA) – created to promote investments in

export-oriented manufacturing industries in the Philippines, and among other myriads
of functions, supervise the grant of both fiscal and non-fiscal incentives.
PEZAregistered enterprises enjoy tax holidays for certain years, exemption from
import and export taxes including local taxes.

 Local Government Tax Collecting Units – Provinces, municipalities, cities and

barangays also imposed and collect various taxes to rationalize their fiscal autonomy.

QUESTIONS TO PONDER

1. What is taxation?
2. What are the differences between theory and the basis of taxation?
3. What are the theories of government cost allocation? Explain each.
4. What is lifeblood doctrine?
5. What are the inherent powers of the state? Briefly explain and differentiate each
power.
6. What is the scope of the power of taxation?
7. What are the differences of the following?
a. Substantive and procedural due process
b. Concept of equality and concept of uniformity in taxation
c. Non-payment of debt and non-payment of taxes in terms of consequences
8. What are the constitutional limitations of the power of taxation? Explain each.
 9. What the stages of the exercise of taxation power?
10. What is situs of taxation?
11. What is the difference between the Marshall doctrine from the Holme’s doctrine?
12. What is the doctrine of strict construction of tax laws?
13. What is double taxation and what are its elements, and its types?
14. What are the categories of escapes from taxation? Enumerate and explain each means
of escape under each category.
15. What are the differences between tax amnesty and tax condonation?
16. What are the differences of tax laws from tax exemption law?
17. What are the sources of tax laws?
18. What is the nature of Philippine tax law?
19. What is tax system and what are its types?
20. What are the principles of a sound tax system? Briefly explain each principle?
REQUIRED READING/S and OTHER LEARNING RESOURCES

1. Chapters 1 - 2, pp. 1-20; pp.35 – 51:

Banggawan, Rex B. 2019. INCOME TAXATION LAWS, PRINCIPLES, AND

APPLICATIONS. Real Excellence Publishing., Pasay Default Barangay, Pasay
City, Philippines.

2. https://www.pwc.com/ph/en/publications/pdf/pwcph-tax-code-2019.pdf.

LEARNING ACTIVITIES/SELF-TESTS

Activity 1: True or False. Identify the statement if it is true or false.

1. Taxes are the lifeblood of the government.
2. Taxation is the mode of apportionment of government costs to the people.
3. There should be a direct receipt of benefit before one could be compelled to pay taxes.
4. The exercise of taxation power requires Constitutional grant.
5. Taxation is inherent in sovereignty.
6. Taxpayers under the same circumstances should be taxed differently.
7. No one shall be imprisoned for non-payment of tax.
8. The government should tax itself.
9. The lifeblood doctrine requires the government to override its obligations and contracts
when necessary.
10. Taxation is subject to inherent and constitutional limitations.
11. International comity connotes courtesy among nations.
12. The scope of taxation is regarded as comprehensive, plenary, limited and supreme.
13. Tax exemption laws grant certain immunity from taxation.
14. Tax is an enforced proportional contribution levied by the lawmaking body.
 15. Special assessment is an example of national tax.

Activity 2: Multiple Choice. Choose the letter of the correct answer.

1. When tax is collected upon someone who is effectively reimbursed by another, the tax is
regarded as a. Direct
b. Indirect
c. Personal
d. Illegal

2. All are ad valorem taxes, except

a. Poll tax
b. Estate tax
c. Real Property tax
d. Capital gains tax on real property capital asset

3. Taxation power can be used to destroy

a. As a revenue measure
b. Even if the tax is invalid
c. As an implement of police power
d. When the State in in dire need of funds.

4. Which is not characteristic of tax?

a. It is an enforced contribution
b. It is generally payable in money
c. It is subject to assignment
d. It is levied by the law-making body of the State

5. Which of the following is a local tax?

a. Value added tax
b. Real property tax
c. Documentary stamp tax
d. Other percentage taxes

6. Tax as a purpose is classified as

a. Fiscal or regulatory
b. Direct or indirect
c. National or local tax
d. Specific or ad valorem tax

7. Taxes that cannot be shifted by the statutory taxpayer are referred to as

a. Direct taxes
b. Indirect taxes
c. Business taxes
d. Personal taxes
8. The point at which tax is levied is also called
a. Situs of taxation
b. Incidence of taxation
c. Assessment
d. Impact of taxation

9. Which of the following inappropriately describes the nature of taxation?

a. Essentially a legislative function
b. Subject to inherent and constitutional limitations
c. Inherent in sovereignty
d. Generally, for public purpose

10. Which is not an object of taxation?

a. Persons
b. Business
c. Transactions
d. Public Properties

11. That courts cannot issue injunction against the government’s effort to collect taxes is
justified by
a. Imprescriptibility of taxes
b. Lifeblood doctrine
c. The ability to pay theory
d. The doctrine of estoppel

12. A. Taxation is the rule, exception is the exemption

B. Vague taxation laws are interpreted liberally in favor of the government.
Which is false? a. A only
b. B only
c. Both A and B
d. Neither A nor B

13. Which tax exemption is irrevocable?

a. Tax exemption based on contracts
b. Tax exemption based on law
c. Tax exemption based on Constitution
d. Both A and B

14. What is the theory of taxation?

a. Government’s necessity for fund
b. Constitutionality
 c. Pubic Purpose
d. Reciprocal duties of support and protection

15. What is the primary purpose of taxation?

a. To enforce contribution from its subjects for public purpose
b. To raise revenue
c. To achieve economic and social stability
d. To regulate the conduct of business or profession

Module 2:

Overview of the Local Government

Units in the Philippines, Local
Taxation and Real Property Tax

LEARNING OBJECTIVES

After completing the lesson, the students will be able to

 Understand the structure of the Philippine government.

 Identify the 3 branches of the government.
 Differentiate state from government.
 Discuss the essential elements of state.
 Understand the composition of local government units.
 Explain the foundation of creating local government units.
 Determine the rules on classifying local government units.
 Identify the duties and functions of local government officials.
 Enumerate the sources of local government funds.
 Explain the taxing duties of local government units.
  Identify and explain the different local taxes.
 Determine the scope and types of local government taxes.  Enumerate the types of taxes
on real properties
 Identify other taxes imposed on local government units.

SALIENT POINTS FOR DISCUSSION

This module provides an overview of the structure and organization of the Philippine
Government, the functions of each branch that composed it, and the system of check and
balances among these branches. It elaborates the various local government units, its organization,
and the duties and responsibilities of those offices under its jurisdiction. It further demonstrates
the taxation power of the local government units and enumerates different taxes that are
currently imposed within the local autonomy in the Philippines.

 The Philippine Government

The Philippines is a republic with a presidential form of government wherein power is
equally divided among its three branches: executive, legislative, and judicial. The
government seeks to act in the best interests of its citizens through this system of check
and balance.

Article 2 Section 1 of The 1987 Constitution, states “The Philippines is a democratic and
republican State. Sovereignty resides in the people and all government authority
emanated from them.

One basic corollary in a presidential system of government is the principle of separation

of powers wherein legislation belongs to Congress, execution to the Executive, and
settlement of legal controversies to the Judiciary.
1. The Legislative branch is authorized to make laws, alter, and repeal them through the
power vested in the Philippine Congress. This institution is divided into the Senate
and the House of Representatives.

The Legislative Branch enacts legislation, confirms or rejects Presidential

appointments, and has the authority to declare war. This branch includes Congress
(the Senate and House of Representatives) and several agencies that provide support
services to Congress.

The Senate is composed of 24 Senators who are elected at large by the qualified
voters of the Philippines.

The House of Representatives is composed of about 250 members elected from

legislative districts in the provinces, cities, and municipalities, and representatives
elected through a party-list system of registered national, regional, and sectoral
parties or organizations.

The party-list representatives shall constitute twenty per cent of the total number of
representatives including those under the party list. For three consecutive terms after
the ratification of this Constitution, one-half of the seats allocated to party-list
representatives shall be filled, as provided by law, by selection or election from the
labor, peasant, urban poor, indigenous cultural communities, women, youth, and such
other sectors as may be provided by law, except the religious sector.

2. The Executive branch is composed of the President and the Vice President who are
elected by direct popular vote and serve a term of six years. The Constitution grants
the President authority to appoint his Cabinet. These departments form a large portion
of the country’s bureaucracy.

The executive branch carries out and enforces laws. It includes the President, Vice
President, the Cabinet, executive departments, independent agencies, boards,
commissions, and committees.

The President leads the country. He or she is the head of state, leader of the national
government, and Commander-in-Chief of all armed forces of the Philippines. The
President serves a six-year term and cannot be re-elected.

The Vice President supports the President. If the President is unable to serve, the Vice
President becomes President. He or she also serves a six-year term.

Cabinet members serve as advisors to the President. They include the Vice President
and the heads of executive departments. Cabinet members are nominated by the
President and must be confirmed by the Commission of Appointments.
3. The Judicial branch holds the power to settle controversies involving rights that are
legally demandable and enforceable. This branch determines whether or not there has
been a grave abuse of discretion amounting to lack or excess of jurisdiction on the
part and instrumentality of the government. It is made up of a Supreme Court and
lower courts.

The judicial branch interprets the meaning of laws, applies laws to individual cases,
and decides if laws violate the Constitution. The judicial power shall be vested in one
Supreme Court and in such lower courts as may be established by law.

Each branch of government can change acts of the other branches as follows:
 The President can veto laws passed by Congress.
 Congress confirms or rejects the President's appointments and can remove the
President from office in exceptional circumstances.
 The Justices of the Supreme Court, who can overturn unconstitutional laws,
are appointed by the President.

The Constitution expressly grants the Supreme Court the power of Judicial Review as
the power to declare a treaty, international or executive agreement, law, presidential
decree, proclamation, order, instruction, ordinance or regulation unconstitutional.

State versus Government

The Philippine President acts as the head of state and leader of the national government.
To understand this, main differences between state and government are discussed below:
1. Government is only an element of the state:
A State has four essential elements—Population, Territory, Government and
Sovereignty. Government is only one element of the State. It is just one part of the
State which acts for the state.

2. Government is an Agency or Agent of the State:

Government is an agency of the State. It acts for the state. It is that agency of the
State which formulates the will of the state into laws, implements the laws of the state
and ensures conformity to the laws of the state. Government exercises power and
authority on behalf of the state.

3. State is Abstract, Government is Concrete:

State is a concept, an idea or a name used to denote a community of persons living on
a definite territory and organized for the exercise of sovereignty. State cannot be seen.
Government is made by the people of the State. It is formed by the representatives of
the people. It has a definite and defined organization and form. It can be seen as a
team of people exercising the power of the State.
4. State is permanent; government is temporary:
Governments come and go regularly. After every general election the government
changes. It can also undergo a total change through an election or even through a
revolution. State is permanent. It continuously lives so long as it continues to enjoy
sovereignty.

Four Elements of State

The Philippines as a republican State is comprised of the following elements:
1. People – population or the citizens. State is a community of persons. It is a human
political institution. Without a population there can be no State. Population can be
more or less but it has to be there.

2. Land or Territory – Territory is the second essential element of the State. State is a
territorial unit. Definite territory is its essential component. A State cannot exist in the
air or at sea. The national territory of the Philippines under Art. 1 of the 1987
Constitution states:

“The national territory comprises the Philippine archipelago, with all the islands and
waters embraced therein, and all other territories over which the Philippines has
sovereignty or jurisdiction, consisting of its terrestrial, fluvial and aerial domains,
including its territorial sea, the seabed, the subsoil, the insular shelves, and other
submarine areas. The waters around, between, and connecting the islands of the
archipelago, regardless of their breadth and dimensions, form part of the internal
waters of the Philippines.”

3. Government - Government is the organization or machinery or agency or magistracy

of the State which makes, implements, enforces and adjudicates the laws of the state.
Government is the third essential element of the State. The state exercises its
sovereign power through its government.

4. Sovereignty or independence – Sovereignty is the most exclusive element of State.

State alone possess sovereignty. Without sovereignty no state can exit.

State has the exclusive title and prerogative to exercise supreme power over all its
people and territory. In fact, Sovereignty is the basis on which the State regulates all
aspects of the life of the people living in its territory.

As the supreme power of the State, Sovereignty has two dimensions:

a. Internal Sovereignty
It means the power of the State to order and regulate the activities of all the
people, groups and institutions which are at work within its territory. All these
institutions always act in accordance with the laws of the State. The State can
punish them for every violation of any of its laws.
 b. External Sovereignty
It means complete independence of the State from external control. It also means
the full freedom of the State to participate in the activities of the community of
nations. Each state has the sovereign power to formulate and act on the basis of its
independent foreign policy.

 Overview of the Local Government Units in the Philippines The

Creation of Local Government Units
Art. X Sec. 1, 2, 10 and 11 of the 1987 Philippine Constitution

Sec. 1 states that “the territorial and political subdivisions of the Republic of the
Philippines are the provinces, cities, municipalities, and barangays. There shall be
autonomous regions in Muslim Mindanao and the Cordilleras as hereinafter provided.”

Sec. 2 further states that “the territorial and political subdivisions shall enjoy local
autonomy.”

Local Autonomy
“Section 2 of Local Government Code of the Philippines:
Sec. 2. Declaration of Policy. – (a) It is hereby declared the policy of the State that the
territorial and political subdivisions of the State shall enjoy genuine and meaningful
local autonomy to enable them to attain their fullest development as self-reliant
communities and make them more effective partners in the attainment of national
goals. Toward this end, the State shall provide for a more responsive and accountable
local government structure instituted through a system of decentralization whereby
local government units shall be given more powers, authority, responsibilities, and
resources. The process of decentralization shall proceed from the National
Government to the local government units.

(c) It is likewise the policy of the State to require all national agencies and offices to
conduct periodic consultations with appropriate local government units,
nongovernmental and people‘s organizations, and other concerned sectors of the
community before any project or program is implemented in their respective
jurisdictions. (Emphases and underscoring supplied)”

Sec. 10 “No province, city, municipality, or barangay may be created, divided, merged,
abolished, or its boundary substantially altered, except in accordance with the criteria
established in the Local Government Code and subject to approval by a majority of the
votes cast in a plebiscite in the political units directly affected.”

Sec. 11 “The Congress may, by law, create special metropolitan political subdivisions,
subject to a plebiscite as set forth in Section 10 hereof. The component cities and
municipalities shall retain their basic autonomy and shall be entitled to their own local
executives and legislative assemblies. The jurisdiction of the metropolitan authority that
will hereby be created shall be limited to basic services requiring coordination.”

"Plebiscite" is the electoral process by which an initiative on the Constitution is

approved or rejected by the people.

General Powers and Attributes of Local Government Units

Local Government Code of 1991
1. Authority to Create Local Government Units – A local government unit may be
created, divided, merged, abolished, or its boundaries substantially altered either by
law enacted by Congress in the case of a province, city, municipality, or any other
political subdivision, or by ordinance passed by the Sangguniang Panlalawigan or
Sangguniang Panlungsod concerned in the case of a barangay located within its
territorial jurisdiction, subject to such limitations and requirements prescribed in this
Code.

2. Creation and Conversion. – As a general rule, the creation of a local government unit
or its conversion from one level to another level shall be based on verifiable
indicators of viability and projected capacity to provide services, to wit:

a. Income. – It must be sufficient, based on acceptable standards, to provide for all

essential government facilities and services and special functions commensurate
with the size of its population, as expected of the local government unit
concerned;

b. Population. – It shall be determined as the total number of inhabitants within the

territorial jurisdiction of the local government unit concerned; and

c. Land Area. – It must be contiguous, unless it comprises two (2) or more islands or
is separated by a local government unit independent of the others; properly
identified by metes and bounds with technical descriptions; and sufficient to
provide for such basic services and facilities to meet the requirements of its
populace.

Compliance with the foregoing indicators shall be attested to by the Department

of Finance (DOF), the National Statistics Office (NSO), and the Lands
Management Bureau (LMB) of the Department of Environment and Natural
Resources (DENR).

Art. X Sec. 4
“The President of the Philippines shall exercise general supervision over local
governments. Provinces with respect to component cities and municipalities, and
cities and municipalities with respect to component barangays, shall ensure that the
 acts of their component units are within the scope of their prescribed powers and
functions.”

LGUs are under the supervision of the President through its cabinet the Department
of the Interior and Local Government.

Local Government Hierarchy

*The dashed lines emanating from the president means that the President only exercises general supervision on local
government.

1. National Government – composed of the three branches of the government with

coequal power. Among these three branches, the supervision of the local government
units is vested in the Executive Department specifically under the Office of the
President. The President through the Secretary of Department of Interior and Local
Government (DILG) supervises the local government units.

2. Provinces - are the primary political and administrative divisions of the Philippines.
Each province is governed by an elected legislature called the Sangguniang
Panlalawigan (Provincial Board) and by an elected governor and vice-governor.

Sangguniang Panlalawigan - is the legislative branch of the province and their

powers and responsibilities are defined by the Local Government Code of 1991. Its
powers, duties and functions are outlined into five broad mandates:
 a. Approve ordinances and pass resolutions necessary for an efficient and effective
provincial government

b. Generate and maximize the use of resources and revenues for the development
plans, program objectives and priorities of the province... with particular attention
to agro-industrial development and country-wide growth and progress and relative
thereto

c. Grant franchises, approve the issuance of permits or licenses, or enact ordinances

levying taxes, fees and charges upon such conditions and for such purposes

d. Approve ordinances which shall ensure the efficient and effective delivery of
basic services and facilities" and, in addition to the services and facilities outlined
in Section 17 of the Local Government Code

e. Exercise such other powers and perform such other duties and functions as may
be prescribed by law or ordinance

The Sangguniang Panlalawigan is composed of regularly elected members and ex

officio members. The Provincial Vice-Governor serves as its presiding officer, who
does not vote except in cases to break a tie.

Regularly elected members are elected from Sangguniang Panlalawigan districts. The
total number of SP members to be elected within the province, and the number within
each SP district, varies depending on several factors, including the province's income
class and the population count within districts.

Ex officio members in the Sanggunian include:

1. The President of the Provincial Chapter of the Liga ng mga Barangay
2. The President of the Provincial Federation of Youth Councils (Sangguniang
Kabataan)
3. The President of the Provincial Federation of Sangguniang Panlungsod and
Sangguniang Bayan members from component cities and municipalities
4. The IP Representative is pursuant to the Republic Act 8371, or the Indigenous
Peoples Rights Act of 1997, which calls for the mandatory representation of IPs
which is formally certified by the concerned NCIP regional director, upon
recommendation of the provincial or community service center head and shall serve
for a period of three years from the date of assumption to office and can be reindorsed
for another term as long as he or she would not serve for more than three consecutive
terms.
5. The Local Government Code of 1991 also provides for the election of 3 "sectoral
representatives,"[1] which are supposed to come from: a. women's sector
b. agricultural or industrial sector
 c. other sectors, including the disabled, the urban poor, or indigenous cultural
communities

Classification of Provinces
Provinces are classified according to average annual income based on the previous 4
calendar years. Effective July 29, 2008, the thresholds for the income classes for
cities are:

*A province's income class determines the size of the membership of its Sangguniang Panlalawigan,
and also how much it can spend on certain items, or procure through certain means.

Provinces are composed of municipalities and cities.

3. Municipalities - Municipalities have some autonomy from the National Government

of the Republic of the Philippines under the Local Government Code of 1991. They
have been granted corporate personality enabling them to enact local policies and
laws, enforce them, and govern their jurisdictions. They can enter into contracts and
other transactions through their elected and appointed officials and can tax. They are
tasked with enforcing all laws, whether local or national. The National Government
assists and supervises the local government to make sure that they do not violate
national law.

Local Governments have their own executive and legislative branches and the checks
and balances between these two major branches, along with their separation, are more
pronounced than that of the national government. The Judicial Branch of the Republic
of the Philippines also caters to the needs of local government units. Local
governments, such as a municipality, do not have their own judicial branch: their
judiciary is the same as that of the national government.

Organization
According to Chapter II, Title II, Book III of Republic Act 7160 or the Local
Government Code of 1991, a municipality shall mainly have a mayor (alkalde), a vice
mayor (ikalawang alkalde/bise alkalde) and members (kagawad) of the legislative
branch Sangguniang Bayan alongside a secretary to the said legislature.
The following positions are also required for all municipalities across the Philippines:
a. Treasurer
b. Assessor
c. Accountant
d. Budget officer
e. Planning and development coordinator
f. Engineer/building official
g. Health officer
h. Civil registrar
i. Municipal Disaster Risks Reduction and Management Officer
j. Municipal Environment and Natural Resources Officer
k. Municipal Social Welfare and Development Officer

Depending on the need to do so, the municipal mayor may also appoint the
following municipal positions: a. Administrator
b. Legal officer
c. Agriculturist
d. Architect
e. Information officer
f. Tourism officer

Duties and Functions

As mentioned in Title II, Book III of Republic Act 7160, the municipal mayor is the
chief executive officer of the municipal government and shall determine guidelines
on local policies and direct formulation of development plans. These responsibilities
shall be under approval of the Sangguniang Bayan.

The vice mayor (bise-alkalde) shall sign all warrants drawn on the municipal treasury.
Being presiding officer of the Sangguniang Bayan (Municipal Council), he can as
well appoint members of the municipal legislature except its twelve (12) regular
members or kagawad who are also elected every local election alongside the
municipal mayor and vice mayor. In circumstances where the mayor permanently or
temporarily vacates the position, he shall assume executive duties and functions.

While vice mayor presides over the legislature, he cannot vote unless the necessity of
tie-breaking arises. Laws or ordinances proposed by the Sangguniang Bayan,
however, may be approved or vetoed by the mayor. If approved, they become local
ordinances. If the mayor neither vetoes nor approves the proposal of the Sangguniang
Bayan for ten (10) days from the time of receipt, the proposal becomes law as if it
had been signed. If vetoed, the draft is sent back to the Sangguniang Bayan. The latter
may override the mayor by a vote of at least two-thirds (2/3) of all its members, in
which case, the proposal becomes law.
 A municipality, upon reaching certain requirements – minimum population size, and
minimum annual revenue – may opt to become a city. First, a bill must be passed in
Congress, then signed into law by the President and then the residents would vote in
the succeeding plebiscite to accept or reject cityhood. One benefit in being a city is
that the city government gets more budget, but taxes are much higher than in
municipalities.

Classifications of Municipalities
Municipalities are divided into income classes according to their average annual
income during the previous four calendar years:

4. Cities - is one of the units of local government in the Philippines. All Philippine cities
are chartered cities, whose existence as corporate and administrative entities is
governed by their own specific municipal charters in addition to the Local
Government Code of 1991, which specifies their administrative structure and powers.
As of September 7, 2019, there are 146 cities.

A city is entitled to at least one representative in the House of Representatives if its

population reaches 250,000. Cities are allowed to use a common seal. As corporate
entities, cities have the power to take, purchase, receive, hold, lease, convey, and
dispose of real and personal property for its general interests, condemn private
property for public use (eminent domain), contract and be contracted with, sue and
exercise all the powers conferred to it by Congress. Only an Act of Congress can
create or amend a city charter, and with this city charter Congress confers on a city
certain powers that regular municipalities or even other cities may not have.

Despite the differences in the powers accorded to each city, all cities regardless of
status are given a bigger share of the Internal Revenue Allotment (IRA) compared to
regular municipalities, as well as being generally more autonomous than regular
municipalities.

A city's local government is headed by a mayor elected by popular vote. The vice
mayor serves as the presiding officer of the Sangguniang Panlungsod (city council),
which serves as the city's legislative body. Upon receiving their charters, cities also
receive a full complement of executive departments to better serve their constituents.
Some departments are established on a case-by-case basis, depending on the needs of
the city.

Cities, like municipalities, are composed of barangays (Brgy), which can range from
urban neighborhoods (such as Barangay 9, Santa Angela in Laoag), to rural
communities (such as Barangay Iwahig in Puerto Princesa). Barangays are sometimes
grouped into officially defined administrative (geographical) districts. Examples of
such are the cities of Manila (16 districts), Davao (11 districts), Iloilo (seven
districts), and Samal (three districts: Babak, Kaputian and Peñaplata). Some cities
such as Caloocan, Manila and Pasay even have an intermediate level between the
district and barangay levels, called a zone. However, geographic districts and zones
are not political units; there are no elected city government officials in these
cityspecific administrative levels. Rather they only serve to make city planning,
statisticsgathering other administrative tasks easier and more convenient.

City Classification based on Income

Cities are classified according to average annual income of the city based on the
previous four calendar years. Effective July 28, 2008, the thresholds for the income
classes for cities are:

Legal Classification of Cities

The Local Government Code of 1991 (Republic Act No. 7160) classifies all cities
into one of three legal categories:

A. Highly urbanized cities (HUC): Cities with a minimum population of two hundred
thousand (200,000) inhabitants, as certified by the Philippine Statistics Authority,
and with the latest annual income of at least fifty million pesos (₱50,000,000 or
USD 1,000,000) based on 1991 constant prices, as certified by the city treasurer.
There are currently 33 highly urbanized cities in the Philippines, 16 of which are
located in Metro Manila.

B. Independent component cities (ICC): Cities of this type have charters that
explicitly prohibit their residents from voting for provincial officials. All five of
them are considered independent from the province in which they are
 geographically located: Cotabato, Dagupan, Naga (Camarines Sur), Ormoc, and
Santiago.

Independent Cities
There are 38 independent cities in the Philippines, all of which are classified as
either "Highly urbanized" or "Independent component" cities. From a legal,
administrative and fiscal standpoint, once a city is classified as such:
a. its Sangguniang Panlungsod legislation is no longer subject to review by any
province's Sangguniang Panlalawigan;
b. it stops sharing its tax revenue with any province; and
c. the President of the Philippines exercises direct supervising authority over the
city government (given that the provincial government no longer exercises
supervision over city officials), as stated in Section 29 of the Local
Government Code

C. Component cities (CC): Cities which do not meet the preceding requirements are
deemed part of the province in which they are geographically located. If a
component city is located along the boundaries of two or more provinces, it shall
be considered part of the province of which it used to be a municipality.

All but five of the remaining cities are considered component cities.

5. Barangays - A barangay, sometimes referred to its archaic name barrio, is the

smallest administrative division in the Philippines and is the native Filipino term for a
village, district, or ward. In metropolitan areas, the term often refers to an inner city
neighbourhood, a suburb, or a suburban neighborhood. The word barangay originated
from balangay, a kind of boat used by a group of Austronesian peoples when they
migrated to the Philippines.

6. Regions - are administrative divisions that primarily serve to coordinate planning and
organize national government services across multiple local government units
(LGUs). Most national government offices provide services through their regional
branches instead of having direct provincial or city offices. These regional offices are
usually (but not always) located in the city designated as the regional center.

Currently, the Philippines is divided into 17 regions. Sixteen of these are mere
administrative groupings, each provided by the President of the Philippines with a
Regional Development Council (RDC) – in the case of the National Capital Region,
an additional metropolitan authority serves as the coordinating and policy-making
body. Only one, the Bangsamoro Autonomous Region in Muslim Mindanao, has an
elected government to which the Congress of the Philippines has delegated certain
powers and responsibilities.

Types of Regions
 1. Administrative Region - An administrative region is not a local government unit
(LGU), but rather a group of LGUs to which the President has provided an unelected
policy-making and coordinating structure, called the Regional Development Council
(RDC). Metro Manila is recognized in law as a "special development and
administrative region", and was thus given the Metropolitan Manila Development
Authority (MMDA); the Metro Manila Council within the MMDA serves as the
National Capital Region's RDC.

2. Autonomous Region - An autonomous region of the Philippines (Filipino: Rehiyong

awtonomo ng Pilipinas) is a first-level administrative division that has the authority to
control a region's culture and economy. The 1986 iteration of the Constitution of the
Philippines allows for two autonomous regions: in the Cordilleras (CAR) and in
Muslim Mindanao (ARMM). Currently Bangsamoro which largely consists of the
Muslim-majority areas of Mindanao is the only autonomous region in the country.

As of December 31, 2019, there are 17 regions, 81 provinces, 146 cities, 1,488
municipalities and 42,045 barangays.

 Local Taxation
Sources of Local Government Funds
The two sources of Local government funds
1. External Sources
Sec. 6 and 7 of Art. X of the Constitution state the LGU is entitled to just share in the
national taxes (taxes collected by the BIR and BOC) which shall be automatically
released to them. The share is determined by law. Further, the LGU is entitled to an
equitable share in the proceeds of the utilization and development of the national
wealth within their respective areas, in the manner provided by law, including sharing
the same with the inhabitants by way of direct benefits.

Examples of External Sources

a. Internal Revenue Allotment (IRA)
b. other shares from special laws, grants and aids and borrowings

2. Local Sources or internal Sources

Art. X Sections 5 to 7 of the Constitution states
Sec. 5 “Each local government unit shall have the power to create its own sources of
revenues and to levy taxes, fees, and charges subject to such guidelines and
limitations as the Congress may provide, consistent with the basic policy of local
autonomy. Such taxes, fees, and charges shall accrue exclusively to the local
governments.”
Taxing Power of Local Government Units
Overview
1. History of fiscal decentralization: Basis
a. Local Autonomy Act of 1959
b. Decentralization Act of 1967
c. 1973 Constitution
d. Batas Pambansa 337 of 1983
e. Presidential Decrees during the Martial Law
f. 1987 Constitution
g. Local Government Code of 1991
2. From centralist (transfer of authority) to people-oriented service delivery at the local
level
3. Presently under the regime of the 1987 Constitution and the Local Government Code
of 1991

Basis of Local Government’s Taxation Power 1.

The 1987 Philippine Constitution
Art. X Sections 5 to 7 of the Constitution states
Sec. 5 “Each local government unit shall have the power to create its own sources of
revenues and to levy taxes, fees, and charges subject to such guidelines and
limitations as the Congress may provide, consistent with the basic policy of local
autonomy. Such taxes, fees, and charges shall accrue exclusively to the local
governments.”

Local Taxing Authority

Section 132. 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.

Scope and Types of Local Government Taxes

1. Real Property Tax
a. Basic Real Property Tax
The real property tax (RPT) is an ad valorem tax (tax based on the value of the
property) on real properties such as lands, buildings, and other improvements, and
machineries imposed by provinces, cities and municipalities within the
Metropolitan Manila Area (MMA), at the following rates:
 Provinces - Not exceeding 1% of the assessed value of the real property;
 Cities or Municipalities within the MMA - Not exceeding 2% of the assessed
value of the real property

The real property tax is based on the assessed value which is a certain percentage
of the market value of the real property. The assessed value is arrived at upon
application of the assessment levels to the market value of the property. The
assessment levels are fixed by ordinance of the local Sanggunian depending on
the actual use of the property, at rates not exceeding the following:

(1) Lands
Class Assessment Levels
 Residential 20%
 Agricultural 40%
 Commercial, Industrial and Mineral 50%
 Timberland 20%

(2) Buildings and Other Structures

The rate progresses directly with the fair market value (FMV) as follows:
 Residential – 0% for those with FMV of PhP175,000.00 or less to 60% for
those with FMV of more than PhP10 million.
 Agricultural – 25% for those with FMV of PhP300,000.00 or less to 50% for
those with FMV of more than PhP2 million.
 Commercial/Industrial – 30% for those with FMV of PhP300,000.00 or less to
80% for those with FMV of more than PhP10 million.
 Timberland – 45% for those with FMV of PhP300,000.00 or less to 70% for
those with FMV of more than PhP2 million.

(3) Machineries
Class Assessment Levels
 Agricultural 40%
 Residential 50%
 Commercial and Industrial 80%

(4) Special Classes

The assessment levels for all lands, buildings, machineries, and other
improvements are as follows:
Actual Use Assessment Levels
 Cultural 15%
 Scientific 15%
 Hospital 15%
 Local Water Districts 10%
 Government-owned or controlled 10% corporations engaged in the supply and
distribution of water and/or generation and transmission of electric power

Exemptions: The following are exempted from payment of the RPT:

 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;
 Charitable institutions, churches, parsonages, or convents appurtenant thereto,
mosques, non-profit or religious cemeteries, and all lands, buildings, and
 improvements actually, directly, and exclusively used for religious, charitable
or educational purposes;
 All machineries and equipment that are actually, directly and exclusively used
by local water districts and government-owned or–controlled corporations
(GOCCs) engaged in the supply and distribution of water and/or generation
and transmission of electric power;
 All real property owned by duly registered cooperatives as provided for under
RA 6938; and
 Machinery and equipment used for pollution control and environment
protection.

Except as provided in the LGC, any exemption from the payment of RPT
previously granted to or presently enjoyed by, all persons, whether natural or
juridical, including all GOCCs were withdrawn upon the effectivity of the LGC.

b. Special Levies on Real Property

(1) Special Education Fund Tax
In addition to the basic RPT, a province or city, or a municipality within the
MMA may levy and collect an annual tax of 1% on the assessed value of real
property which shall be in addition to the basic RPT. The proceeds thereof
shall exclusively accrue to the Special Education Fund (SEF) to support
public education.

(2) Idle Lands Tax

A province or city, or a municipality within the MMA may levy an annual
tax on idle lands at a rate not exceeding 5% of the assessed value of the
property which shall be in addition to the basic RPT.

Coverage
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. Not considered as idle
lands are (i) agricultural lands planted to permanent or perennial crops
with at least fifty (50) trees to a hectare, and (ii) lands actually used for
grazing purposes.
b. Lands, other than agricultural, located in a city or municipality more than
one thousand (1,000) square meters in area, one-half of which remain
unutilized or unimproved.

Regardless of land area, the tax 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.
 Exemption
The LGU 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.

(3) Special Levy

A province, city or municipality may impose a special levy on the lands
within its territorial jurisdiction specially benefitted by public works projects
or improvements funded by the LGU concerned. The special levy shall not
exceed 60% of the actual cost of such projects and improvements, including
the costs of acquiring land and such other real property in connection
therewith.

The special levy shall not apply to lands exempt from basic RPT and the
remainder of the land portions of which have been donated to the LGU
concerned for the construction of such projects or improvements.

(4) Other Impositions on Real Property

a. Socialized Housing Tax
In addition to the RPT and SEF tax, a socialized housing tax may also be
imposed by a province, city or municipality within the MMA. The tax is
1/2 of 1% of the assessed value of all lands in urban areas in excess of
PhP50,000.00.

b. Tax on Transfer of Real Property Ownership

A province, city or municipality within the MMA may impose a tax on the
sale, donation, barter, or any other mode of transferring ownership or title
of real property at the rate of not more than 50% of 1% in the case of a
province and 75% of 1% in the case of a city or a municipality in MMA of
the total consideration involved in the acquisition of the property or of the
FMV 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 RA 6657

(Comprehensive Agrarian Reform Law of 1988) shall be exempt from the tax.

(5) Collection of Real Property Tax

The real property tax for any year shall accrue on the first day of January. The
basic RPT and the additional SEF tax may be paid without interest in four (4)
equal installments; the first installment to be due and payable on or before
March 31; the second installment, on or before June 30; the third installment,
on or before September 30; and the last installment on or before December 31.
 The special levy shall accrue on the first day of the quarter next following the
effectivity of the ordinance imposing such levy. Its payments shall be
governed by the ordinance of the Sanggunian concerned.

The tax on transfer of real property ownership shall be paid within sixty (60)
days from the date of the execution of the deed or from the date of the
decedent’s death.

The date for the payment of any other tax on real property shall be prescribed
by the Sanggunian concerned.

Notes to Real Property Taxes

Being a property owner entails a series of never-ending responsibilities. As
property owner, it is your civic duty to know about the fees and taxes we need to
pay. One of which is called the Real Property Tax. Below are the frequently asked
questions on real property tax in the Philippines.

Q: What is Real Property Tax?

A: Real property tax is a kind of tax levied by the local government on properties
and should be paid by property owners. Properties that are taxable include land,
building, improvements on the land and/or the building, and machinery.

Q: Why are properties being taxed?

A: In 1991, Republic Act 7160, also known as the Local Government Code was
passed. Under this law, local governments are given the authority to create and
collect their own source of revenue to fund public expenditure. These sources of
income include real property taxes among others.

Q: Who should pay for Real Property Tax?

A: People who owns or whose names are on titles and certificates of ownership,
whether the property is for residential or commercial use.

Q: How much is the Real Property Tax?

A: The Metro Manila rate for Real Property tax is 2% while the provincial rate is
1% of the assessed value of the property.

Q: Are there other taxes levied by the government that I should know of? A:
Apart from the basic real property tax, local governments also charge additional
tax for the Special Education Fund. An additional 1% is levied on the assessed
value of the real property, and proceeds of which go to the budget of local
schools.
If properties become idle, the government also charges a maximum of 5% of the
assessed value in addition to the basic real property tax. That’s why it is always
prudent to put your land to good use and generate income for you.

Q: How do I compute the Real Property Tax?

A: To compute how much in total real property tax (RPT) needs to paid, we
multiply the RPT rate by the assessed value.

Assessed value may be interpreted as the property’s taxable value. To get the
taxable value of a property, we must first multiply the market value to the
assessment level. Assessment levels differ per property, based on their area and/or
their usage. Assessment levels are prescribed by Section 218 of the Local
Government Code.

Example:

A residential property located in Makati City, Metro Manila, owned by Ms.

Mandarambong is said to have a market price of Php10,000,000.00. The property
is comprised of a parcel of land valued at Php6,000,000, while the structure of the
house itself, also known as building or improvement, is valued at Php4,000,000.

We compute for the total assessed value of the property by adding the assessed
value of the residential land and assessed value of the building.

(A) Assessed Value of Land: Residential land (Php6,000,000) x Assessment

Level (20%) = Php1,200,000

(B) Assessed Value of the Building: House (Php4,000,000) x Assessment Level

(40%) = Php1,600,000

(C) Total Assessed Value of the Property: (A) + (B) = Php 2,800,000

Now that we have the total assessed value of the property, we multiply it by the
applicable Real Property Tax rate to get the tax amount to be paid by Ms.
Mandarambong.

(D) Real Property Tax: (C) x Metro Manila RPT rate (2%) = Php56,000

The total basic real property tax to be paid by Ms. Mandarambong is Php56,000.
However, we must also add the tax for the Special Education Fund.

(E) Special Education Fund (SEF) levy: (C) x SEF levy = Php28,000
Therefore, the total tax to be paid by Ms. Mandarambong (D + E), is Php 84,000.
 Q: How often are Real Property Taxes paid? Is there a deadline?
A: Property owners can opt to pay for their real property taxes in full or through
quarterly installments.

For those who choose to pay it in full, the deadline is before January 31 of each
year. For those who choose to pay it in quarterly, deadlines are as follows:
• First quarter: On or before January 31 annually
• Second quarter: On or before June 30
• Third quarter: On or before September 30
• Fourth quarter: On or before December 31

Q: Where do I pay the Real Property Tax?

A: Owners may pay their taxes at Land Tax Division of the Treasurer’s Office of
the Local Government Unit. Online modes of payment may be available, but you
must check this first with your local government.

Q: What happens if I pay my taxes in advance?

A: Some cities offer tax discounts to those who pay before their prescribed
deadlines, best to check with your municipal or city treasurer for more
information.

Q: What happens if I pay the tax later than the deadline?

A: Penalties are imposed on late payments. Penalty is at 2% interest per month on
the unpaid amount, and can reach a maximum of 72% if unpaid for 36 months or
3 years.

2. Other Local Taxes

Local government units are empowered to impose the following taxes:
A. Provincial Taxes
a. Tax on business of printing and publication at a rate not exceeding 50% of 1%
of the gross annual receipts for the preceding calendar year. In case of newly
started business, the tax shall not exceed 1/20 of 1% of the capital investment.
b. Tax on a business enjoying franchise at a rate not exceeding 50% of 1% of the
gross annual receipts for the preceding calendar year. In case of a newly
started business, the tax shall not exceed 1/20 of 1% of the capital investment.
c. Tax on sand, gravel and other quarry resources at a rate not exceeding 10% of
the 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 (NIRC), as amended, extracted from public lands or
from the beds of seas, lakes, rivers, streams, creeks, and other public waters
within its territorial jurisdiction.
d. Professional tax on each person engaged in the exercise or practice of his/her
profession requiring government examination at a rate not exceeding
PhP300.00.
 e. Amusement tax payable by proprietors, lessees, or operators of theaters,
cinemas, concert halls, circuses, boxing stadia, and other places of amusement
at a rate of not more than 10% of the gross receipts from admission fees.
f. Annual fixed tax not exceeding PhP500.00 for every delivery truck or van
used by manufacturers, producers, wholesalers, dealers or retailers in the
delivery or distribution of distilled spirits, fermented liquors, soft drinks,
cigars and cigarettes, to sales outlets, or consumers, whether directly or
indirectly, within the province.

B. Municipal Taxes
a. Business Taxes
There are three (3) kinds of business taxes imposed by municipalities:
(a) a combination of a graduated-fixed and percentage business taxes;
(b) percentage tax; and (c) annual tax.

The following are subject to a combination of a graduated-fixed and

percentage business taxes:
1. 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 at
rates ranging from PhP165.00 for gross receipts of less than PhP10,000.00
to PhP24,375.00 for gross receipts of PhP5 million to PhP6,499,999.00.
Those with gross receipts of PhP6,500,000.00 or more are taxed at a rate
of not exceeding 37 1/2% of 1% of the gross receipts.

2. Wholesalers, distributors, or dealers in any article of commerce of

whatever kind or nature at rates ranging from PhP18.00 for gross receipts
of less than PhP1,000.00 to PhP10,000.00 for gross receipts of PhP1
million to PhP1,999,999.00. Those with gross receipts of PhP2 million or
more are taxed at a rate of not exceeding 50% of 1% of the gross receipts.

3. Exporters, and manufacturers, millers, producers, wholesalers,

distributors, dealers or retailers of essential commodities are subject to not
more than one-half (1/2) of the rates prescribed for manufacturers
wholesalers and retailers of other products.

4. Contractors and other independent contractors at rates ranging from

PhP27.50 for gross receipts of less than PhP5,000.00 to PhP11,500.00 for
gross receipts of PhP1 million to PhP1,999,999.00. Those with gross
receipts of PhP2 million or more are taxed at a rate of not exceeding 50%
of 1% of the gross receipts.

Percentage taxes are imposed on the following:

 1. Retailers, at rates of 2% for gross receipts of PhP400,000.00 or less and
1% for gross receipts over PhP400,000.00.

*Barangays have exclusive power to levy taxes on gross sales or receipts

of P50,000 or less in the case of cities, and P30,000 or less, in the case of
municipalities.

2. Banks and other financial institutions at a rate not exceeding 50% of 1%

of 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.

3. Any business, not otherwise specified in the preceding paragraph at a rate

to be determined by the local Sanggunian. If the business is subject to the
excise, VAT or percentage tax under the NIRC, the rate shall not exceed
2% of the gross sales or receipts of the preceding calendar year.

Annual tax on peddlers engaged in the sale of any merchandise or article

of commerce, at a rate not exceeding PhP50.00 per peddler.

C. City Taxes
The city government may impose and collect any of the taxes, fees and charges
imposed by the province or municipality. The rates of taxes may exceed the
maximum rates allowed for the province or municipality by not more than 50%
except the rates of professional and amusement taxes which are already fixed.

D. Barangay Taxes
The barangay may impose a tax on stores or retailers with fixed business
establishments with annual gross sales or receipts of PhP50,000.00 or less in the
case of cities; and PhP30,000.00 or less, in the case of municipalities, at a rate not
exceeding 1% of gross sales or receipts.

E. Community Tax
City and municipal government may impose a community tax at the following
rates:
a. Individuals Basic community tax ………………………....... PhP5.00
Additional tax – For every PhP1,000.00 of income .…............ PhP1.00 The
tax, however, shall in no case exceed PhP5,000.00.

b. Corporations Basic community tax………………………... PhP500.00

Additional tax –
 For every PhP5,000.00 worth of real property …............................. PhP2.00
 For every PhP5,000.00 worth of gross receipts/ earnings
 derived from business…………………………………………….... PhP2.00

The tax, however, shall in no case exceed PhP10,000.00.

Exemptions:
The following are exempt from the community tax:
 Diplomatic and consular representatives; and
 Transient visitors when their stay in the Philippines does not exceed three (3)
months.

3. Other Revenue-Raising Powers of Local Governments

1. Common
a. Service Fees and Charges - LGUs may impose and collect such reasonable
fees and charges.
b. Public Utility Charges - LGUs may fix the rates for the operation of public
utilities owned, operated and maintained by them within their jurisdiction.
c. Toll Fees and Charges - LGUs 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 LGU concerned.

2. Municipalities
a. Fees and charges on business and occupation and, except as reserved to the
province in Section 139 of the LGC, on the practice of any profession or
calling, commensurate with the cost of regulation, inspection and licensing at
rates to be prescribed by the Sangguniang Bayan.
b. Fees for the sealing and licensing of weights and measures at rates to be
prescribed by the Sangguniang Bayan.
c. Rentals, fees or charges on the use of municipal waters at rates prescribed by
the Sangguniang Bayan.

3. Cities - Fees and charges imposed by the province or municipality.

4. Barangays Fees and charges:

a. For services rendered in connection with the regulation or the use of
barangay-owned properties or service facilities.
b. For the issuance of a barangay clearance for any business or activity located
or conducted within the territorial jurisdiction of the barangay before the city
or municipality may issue a license or permit to said business or activity.
c. On commercial breeding of fighting cocks, cockfights and cockpits.
d. On places of recreation which charge admission fees.
e. On billboards, signboards, neon signs, and outdoor advertisement.

5. Deadline for payment or Collection of Taxes, Fees and Charges

 All local taxes, fees and charges shall accrue on the first 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.

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 payments may be
made in quarterly installments.

QUESTIONS TO PONDER

1. What are the three branches of the Philippine government? Enumerate their functions.
2. How is the system of check and balances among the three branches of the government
work?
3. What are the differences between the state and government?
4. What are the elements of the state? Briefly discuss each element.
5. How is the local government unit in the Philippines created?
6. What are the duties and functions of Provincial Vice-Governor?
7. What are the duties and functions of municipal council?
8. How are the local government units being classified?
9. How is the system of check and balances of government branches in the local
government unit exercised?
10. What are the two classifications of regions in the Philippines? Briefly state their
differences.
11. What is basic real property tax and who are exempted from paying this tax?
12. What is idle land tax?
13. When is the deadline for collection of real property tax?
14. What are the three business taxes imposed by municipalities?
15. What are the other revenue raising power of local governments?

REQUIRED READING/S and OTHER LEARNING RESOURCES

1. https://www.gov.ph/philippine-government
2. https://www.yourarticlelibrary.com/difference/9-main-differences-between-state-
andgovernment/40327
3. https://www.officialgazette.gov.ph/downloads/1991/10oct/19911010-RA-7160-CCA.pdf
 4. https://www.officialgazette.gov.ph/constitutions/1987-constitution/
5. https://www.officialgazette.gov.ph/1987/07/25/executive-order-no-249-s-1987/
6. https://www.comelec.gov.ph/?r=References/RelatedLaws/ElectionLaws/OtherElectionLa
ws/RA6735
7. http://www.ntrc.gov.ph/images/Publications/guide-to-philippine-taxes-2016/localtaxes.pdf
8. https://www.philippineairlines.com/FAQs/TaxesFeesandSurcharges
9. http://blgf.gov.ph/wp-content/uploads/2015/11/LGU-Taxation-and-Revenue-
PracticesOctober-2015.pdf

Videos:
1. Local Government Unit - https://www.youtube.com/watch?v=D2TItIpbFrs
2. Real Property Tax - https://www.youtube.com/watch?v=IhzAm3_8ixA&t=524s

LEARNING ACTIVITIES/SELF-TESTS

Activity 1: True or False. Identify the statement if it is true or false.

1. The power of the government is exclusively vested to the administrative department and
delegated power is shared to the other branches of the government.
2. The power to declare war is expressly given by the Constitution to the Judicial branch as
part of its judicial review.
3. The government differs from the state in such a way that a government is just one part of
the state and acts as its agency.
4. The total numbers of Sangguniang Panlalawigan members is the same to all the
provinces.
5. Same with the national government, the members of legislative branch of the local
government shall include representatives from labor, peasant, urban poor, indigenous
cultural communities, women, youth, and such other sectors provided by law.
6. The principles of separation of powers between executive and legislative branches of the
government is also present in the local government units.
7. As corporate entities, cities have the power to take, purchase, receive, hold, lease,
convey, and dispose of real and personal property for its general interests.
8. The creation and amendment of city charter is a legislative act that can be delegated.
9. Regions are administrative divisions that primarily serve to coordinate planning and
organize national government services across multiple local government units.
10. Taxation power of the local government units is inherently legislative in nature.
11. Real property tax is an ad valorem tax on real properties such as lands, buildings, and
other improvements, and machineries imposed by provinces, cities and municipalities.
12. Machinery and equipment used for pollution control and environment protection is
exempted from real property tax.
13. A province may not impose a special levy on the lands within its territorial jurisdiction
specially benefitted by public works projects funded by the LGU concerned.
 14. The real property tax for any year shall accrue on the first day of January.
15. Transient visitors when their stay in the Philippines does not exceed six (6) months are
exempt from community tax.

Activity 2: Multiple Choice. Choose the letter of the correct answer.

1. Which of the following is a rate for real property tax?
A. Not exceeding 2% of the assessed value of the real property in provinces
B. Not exceeding 2% of the within the city and MMA assessed value
C. Not exceeding 1% of the assessed value of the real property in provinces
D. Not exceeding 2% of the assessed value of the real property in cities and MMA

2. Which of the following statement is incorrect?

A. The real property tax is based on a certain percentage of the market value of the real
property.
B. The assessed value is based on the application of the assessment levels to the fair
value of the property.
C. The assessment level for agricultural land is 40% in provinces, cities and
municipalities within MMA.
D. The real property is a tax dependent on the value of the property subject to tax.

3. Which of the following statement is true?

A. The assessment level for agricultural building is 25% for those with fair value of
above P300,000.00
B. The assessment level for agricultural building is 50% for those with fair value of more
than P2M.
C. The assessment level for commercial building is 30% for those with fair value of less
than P300,000.00,
D. The assessment level for commercial building is 80% for those with fair value of
P10M and above.

4. The following are exempt from real property taxes, except

A. All real property owned by duly registered cooperatives as provided for under RA
6938; and
B. Machinery and equipment used for pollution control and environment protection
C. Real property owned by the Republic of the Philippines
D. Real property owned by the Republic of the Philippines but the use is granted to a
taxable person

5. Which of the following statement is not correct?

A. In addition to the basic real property tax, a local government unit may levy and collect
an annual tax of 1% on the assessed value of real property.
B. In addition to the basic real property tax, a local government unit within the MMA
may levy and collect an annual tax of 1% on the assessed value of real property.
 C. In addition to the basic real property tax, cities within MMA may levy and collect an
annual tax of 1% on the assessed value of real property.
D. In addition to the basic real property tax, special education fund tax may be levied and
collected in cities within MMA.

6. The following are classified as idle land, except

A. Agricultural lands, more than one hectare in area, not suitable for cultivation, one-half
of which remain uncultivated or unimproved.
B. Agricultural lands, more than one hectare in area, suitable for cultivation, one-half of
which remain uncultivated or unimproved.
C. Non-agricultural land, located in a city, more than one thousand square meters in area,
one-half of which remain unutilized.
D. Lands, other than agricultural, located in a city, more than one thousand square meters
in area, one-half of which remain unutilized.

7. Which statement is correct?

A. An additional 1/2 of 1% tax rate of the assessed value of all lands in urban areas in
excess of P50,000.00 is added to real property tax for cities within MMA.
B. A socialized housing tax may also be imposed by cities within the MMA in addition
to real property and special education fund taxes.
C. An additional 1/2 of 1% tax rate of the assessed value of all lands in urban areas in
excess of P50,000.00 is added to real property tax for cities.
D. A socialized housing tax may also be imposed by cities in addition to real property
and special education fund taxes.

8. The following differentiate state from the government, which is not? A. One of the parts
of state is the government.
B. State exercises authority through the government.
C. Government exists even without a State.
D. State exists even without a government.

9. The following are characteristics of Philippine government, except A. It is composed of 3

branches with co-equal power.
B. There is a system of check and balances among the 3 branches of the government.
C. Overlapping of functions sometimes exists among the branches.
D. The Philippine is a republican State.

10. The following are verifiable indicators in the creation of local government units, except
A. Income
B. People
C. Land Area
D. Population
Activity 3: Problem. Analyze the problem and answer the questions below.
A residential property located in Quezon City, Metro Manila, owned by Mr. Cura Cot is said to
have a market price of P15M. The property is comprised of a parcel of land valued at P9M,
while the structure of the house itself, also known as building or improvement, is valued at P6M.
1. How much is the total assessed value?
2. How much is the real property tax?
3. How much is the additional tax?
a. Special Education Fund Tax
b. Socialized Housing Tax

References
Book/s:

Banggawan, Rex B. 2019. INCOME TAXATION LAWS, PRINCIPLES AND

APPLICATIONS.
Real Excellence Publishing., Pasay Default Barangay, Pasay City, Philippines.

Video/s:

Local Government Unit. Retrieved from https://www.youtube.com/watch?v=D2TItIpbFrs.

Real Property Tax. Retrieved from https://www.youtube.com/watch?v=IhzAm3_8ixA&t=524s.

Other Resources:

Executive Order No. 249, series of 1987. Providing for a New Income Classification of
Provinces, Cities, and Municipalities, and for Other Purposes. Retrieved from
https://www.officialgazette.gov.ph/1987/07/25/executive-order-no-249-s-1987/.
Local Taxes. Retrieved from http://www.ntrc.gov.ph/images/Publications/guide-to-
philippinetaxes-2016/local-taxes.pdf.

LGU Taxation and Revenue Practices. Retrieved from

http://blgf.gov.ph/wpcontent/uploads/2015/11/LGU-Taxation-and-Revenue-Practices-
October-2015.pdf.

Republic Act No. 6735. An Act Providing for A System of Initiative and Referendum and
Appropriating Funds Therefor. Retrieved from https://www.comelec.gov.ph/?
r=References/RelatedLaws/ElectionLaws/OtherElectionLa ws/RA6735.

Taxes, Fees and Surcharges. Retrieved from

https://www.philippineairlines.com/FAQs/TaxesFeesandSurcharges.

The Constitution of the Republic of the Philippines. Retrieved from

https://www.officialgazette.gov.ph/constitutions/1987-constitution/.

The Local Government Code of the Philippines. Retrieved from

https://www.officialgazette.gov.ph/downloads/1991/10oct/19911010-RA-7160-CCA.pdf.

The National Internal Revenue Code of 1997. Retrieved from

https://www.pwc.com/ph/en/publications/pdf/pwcph-tax-code-2019.pdf.

The Nine Main Differences between State and the Government. Retrieved from
https://www.yourarticlelibrary.com/difference/9-main-differences-between-state-
andgovernment/40327.

The Philippine Government. Retrieved from https://www.gov.ph/philippine-government.