Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
- Direct Taxes imposed on the privilege to use real property such as land, building, machinery, and
other improvements, unless specifically exempted.
Rules on Machines:
1. If permanently attached - Subject to Real Property Tax
2. If not, permanently attached:
a. Essential and Principal element of an industry without which such industry, work or activity
cannot function - Subject to RPT
b. Otherwise, not subject to RPT
*Both of these can be exercised and a local tax can be enacted without public hearing.
Purpose: Enables the assessor to identify the property for purposes of determining assessment levels.
However, it does not prove ownership, only and inidicium of a claim of ownership.
What if a tax declaration is made to a person who has no successional or administrative rights to an
estate?
-Null and Void because real property tax shall be assessed in the name of the person owning or
administering the property.
For a property declared for the first time, it shall be assessed for back taxes for not more than 10
years prior to the date of initial assessment.
As a general rule, properties shall be listed, valued, and assessed in the name of the owner,
administrator, or anyone having legal interest. Except:
For Land:
a. Assessor summons the owner and takes deposition concerning the property (ownership,
amount, nature, and value)
b. Assessor prepares a schedule of FMV for difference classes of properties
c. The said schedule is published in a newspaper of general circulation in the place concerned. In
the absence thereof, it shall be posted in the provincial capitol, city or municipal hall, and to 2
other conspicious public places
d. Assessor may recommend to Sanggunian concerned amendments to correct errors in
valuation.
For Machinery:
a. For brand new - acquisition cost. If imported, include freight, insurance, bank and other
charges, brokerage, arrastre and handling, duties and taxes, plus charges.
b. Otherwise, use this formula:
Remaining economic life x Replacement/Reproduction Cost = FMV
Estimated Economic life
Economic life - Estimated period of which the machinery may be profitable utilized.
Remaining economic life - period of time from the date of appraisal to the date the machine
becomes valueless
Replacement or Reproduction Cost - cost that would be incurred in acquiring an equally
desirable substitute property, or of producing replica on the basis of current prices
Actual use - Refers to the purpose for which the property is principally or predominantly utilized
by the person in possession thereof.
Exception:
1. For Mixed land uses - predominant use of the lands shall govern the classification, valuation,
and assessment
2. For buildings used for a purpose different form that which the land is classified - predominant
use of the building or buildings shall govern.
For Land:
Land Use Assessment Level Not to Exceed
Residential 20%
Agricultural 40%
Commercial, Industrial, and Mineral 50%
Timberland 20%
For Machineries
Class Assessment Level Not to Exceed
Residential 50%
Agricultural 40%
Commercial & Industrial 80%
*The concerned assessor shall undertake a general revision of real property assessments within 2
years after the effectivity of LGC, and every 3 years thereafter.
Formula:
Market value xxx
Multiply by: Assessment level x%
Assessed Value xxx
Multiply by: Rate of Tax x%
Real Property Tax xxx
Special Levies
1. Special Education Fund (SEF) - 1% of the assessed value additional real estate tax to finance the
Special Education Fund
2. Additional Ad Valorem on Idle lands - not exceeding 5% of the assessed value of the property
Purpose: To penalize landowners for not using their properties productively, and to encourage
land resource utilization for national development.
4. Imposed by other laws like Socialized Housing Tax - Additional one-half (0.5%) of the assessed
value of all lands in urban areas in excess of 50,000 pesos.