Gonadan Ericha Joy A.

TAXATION
____________________________________________
-is a power inherent in every sovereign state
(a) to impose a charge or burden upon
persons, properties or rights
(b) to raise revenues for the use and support
of the government and;
(c) enable it to discharge its appropriate
functions
-That which is imposed is called tax.
Basic Principles of Taxation
(a) Fiscal Adequacy: The sources of
revenues, as a whole, should provide
enough funds to meet the expanding
expenditures of the government.
(b) Theoretical Justice: Taxes must be
based on the taxpayers ability to
pay
(c) Administrative feasibility: The tax
should be clear to the taxpayer, not
unduly
burdensome
and
discouraging to business, convenient
as to time and manner of payment,
and capable of enforcement by
competent public officials.
Constitutional limitations of Taxation:
(Examples)
1. No person shall be imprisoned for
debt or non-payment of a *poll tax.
2. The rule on taxation shall be uniform
and equitable
3. Charitable institutions, churches,
parsonages or convents appurtenant
thereto, mosques, and non-profit
cemeteries, and all kinds of lands,
buildings and improvements actually,
directly or exclusively used for
religious or charitable purposes shall
be exempt from taxation.
4. All revenues and assets of non-profit
educational
institutions,
used
actually, directly and exclusively for
educational purposes are exempt
from taxes and duties.
Tax
Essential Characteristics of a tax:
(a) It is forced contribution;

(b) It is exacted pursuant to legislative

authority in the exercise of the
taxing power;
(c) It is proportionate in character;
(d) It is imposed for the purpose of
raising revenue;
(e) It is to be used for a public purpose
Taxation distinguished from *Eminent
domain:
Taxation reaches all the persons,
properties, etc., covered by the tax, while
eminent domain reaches only a particular
owner of property. There is payment of
money by a taxpayer in taxation, while
there is taking of property by the
government in
eminent
domain. In
Taxation, the taxpayer is presumed to
receive a benefit from the government,
while in eminent domain, the property
owner receives a benefit by way of just
compensation.
Taxation distinguished form Police
Power:
Taxation is for purposes of raising
revenues, while police power is for
purposes of regulation. In taxation, there is
no limit on the amount of the tax that may
be impose, while in police power, the
license fee should be, as a general rule, just
enough to carry out regulation.
Classification of Taxes:
1. As to Subject Matter:
(a) Personal, capitation or poll tax: A
fixed amount upon all persons, or
upon all persons of a certain
class, residents within a specified
territory, without regard to their
property or occupation.
(b) Property tax: A tax assessed
against all properties, or all
properties of a certain class,
located within the jurisdiction of
the taxing authority in proportion
to its value, or on some other
method of apportionment.
(c) Excise tax: A charge upon the
performance of an act, the
enjoyment of a privilege, or the

engaging in an occupation. An
excise tax is a tax which is not
a personal tax or a property tax
2. As to who bears the burden:
(a) Direct Tax: One which is
demanded from the person
whom the law intends or
desires to pay it.
(b) Indirect Tax: One which is
shifted by the taxpayer to
someone else
3. As to determination of the
amount:
(a) Specific Tax: A tax which
imposes a specific sum by the
head or number, or some
standard
of
weight
or
measurement,
and
which
requires no assessment other
than
by
the
listing
and
classification of the subjects to
be taxed.
(b) Ad valorem Tax: A tax or duty
upon the value of the article or
subject of taxation. A tax of so
much per centum of the invoice
or appraised value of the goods
subject to the tax
4. As to purpose:
(a) General Tax: A tax levied for
general
purposes
of
government.
(b) Special Tax: A tax levied for a
special purpose.
5. As to proportionality:
(a) Progressive: A tax in which the
increase in the tax rate is
proportionate to the increase in
the tax base.
(b) Regressive: A tax in which the
increase in the tax rate is not
proportionate to the increase in
the tax base
(c) Proportional: A tax of a fixed
percentage of amount of the
base
6. As to scope:
(a) National Tax

A tax levied by the National

Government
(b) Local Tax
- A
tax
levied
by
a
Local
government.
LOCAL TAXATION
________________________________________
-

Each local government unit shall

have the power to create its own
sources of revenue and ot levy
taxes, subject to such limitations
as may be provided by law
(provision
of
the
Philippine
Constitution). Hence, the power of
local governments to impose local
taxes is delegated power from the
National Government.

Basic Principles of Local Taxation:

(a) Taxation shall be uniform in each
local government unit;
(b) Taxes, fees, charges and other
impositions should be equitable,
for a public purposes, must not be
unjust, excessive, oppressive or
confiscatory, and must not be
contrary to law, public policy and
national economic policy or in
restraint of trade;
(c) In no case shall the collection of
local taxes and other imposition
be let to any person;
(d) The revenues collected under the
Local Government Code shall
inure only to the benefit of, and
subject to disposition by, the local
government imposing the tax or
fee, unless otherwise specifically
provided in the LGC
(e) It shall be the responsibility of
each local political subdivision to
evolve a progressive system of
taxation.

CHAPTER III

Assessment Appeals
Section 226. * Local Board of
Assessment Appeals.
- 60 days
Section 227. Organizaiton, Powers,
Duties, and Functions of the LBAA
(a) BAA shall be composed of:
- Registrar of Deeds CHAIRMAN
- Provincial/City
Prosecutor

Members
- Provincial/City
Engineer

Members
(b) Chairman:
- Designate employee of province or
city as secretary to the Board
without additional compensation
Section 228. Meetings and Expenses
of the LBAA
(a)
- Shall meet ONCE a month/ as often
as may be
- No *per diems or traveling expenses
for attending Board meeting except
when conducting ocular inspection in
connection with a case under *appeal
(b)
Sanggunian concerned shall
appropriate the necessary funds
- All expenses General fund of
province/city
Section 229. Action by the LBAA
(a) Decision of Appeal 120 days
from the date of receipt of the
appeal
-Hearing Decision
(b) powers:
- summon witnesses
-administer oaths
-conduct ocular inspection
-take despositions
-issue *subpoena and *subpoena
duces tecum
(c) Secretary of LBAA
- shall give a copy of the decision of
the Board to:
1. the owner of the property/ the
person having legal interest therein

2. *Provincial or City assessor

---If 1 and 2 are not satisfied with the
decision of the Board, they may
appeal to the *Central Board of
Assessment Appeals for final decision
executory (within 30 days after receipt
of decision of the LBAA)
Section 230. Central BAA
- Composed of:
1. CHAIRMAN 7 years term
2. 2 members appointed by
president
- one member for 5 years term
- other member for 3 years
term
3. Hearing Officers
- appointed by the CBAA
- serve 6 years term
-same qualifications as that of the
Judges of the Municipal Trial Courts
- one each for (who shall hold
office in)
:Luzon
(Manila)
:Visayas
(Cebu City)
: Mindanao (Cagayan de Oro City)
Note:
1. No reappointments.
2. No appointment or designation in a
temporary or acting capacity.
3. Chairman and members of the Board
shall be Filipino citizens
4. Board members and Chairman shall
be at least 40 years old at the time of
appointment
5. Members of the Bar or CPAs for at
least 10 years immediately preceding
their appointment.
6. Chairmans salary = rank of Director
III
Under the Salary Standardization Law
Members salary = rank of Director II
- Exclusive of allowance and other
*emoluments.
7. CBAA
shall
have
*appellate
jurisdiction over all cases decide by
the LBAA

8. CBAA may extablish and organize

staffs, offices, units, prescribe the
titles, functions, and duties of their
members and adopt its own rules and
regulations

(d) All real property owned by duly

registered
cooperatives
as
provided for under *RA No.
6938
(e) Machinery
and
equipment
used for pollution control and
environmental protection.

Section 231. Effect of Appeal on the

Payment of **Real Property Tax
- Collection of the corresponding
realty
taxes
shall
not
be
suspended
on
the
property
involved as assessed by the
provincial or city assessor.

CHAPTER V
Special Levies on Real
Property

CHAPTER IV
Imposition of Real Property
Tax

Section 232. Power to Levy Real

Property Tax.
P/C/M within Metropolitan Manila
may levy an annual *ad valorem
tax on real property
Section 233. Rates of Levy
P/C/M within Metropolitan Manila
shall fix a uniform rate:
(a) Province 1%
(b) City or Municipality 2%
Section 234. Exemptions from
Real Property Tax
(a) Property
owned
by
the
Republic of the Philippines or
any of its political subdivisions
(b) Charitable
institutions,
churches,
*parsonages
or
convents, appurtenant thereto,
mosques,
non-profit
or
religious cemeteries and all
lands, buildings exclusively
used for religious, charitable or
educational purposes
(c) All
machineries
and
equiptments local water
districts
and
government
owned corporations for the
distribution of electric power

Section 235. Additional Levy on

RP for the *Special Education
Fund.
P/C/M within Metropolitan Manila
may collect an annual tax of 1% in
addition to the basic real property
tax for SEF.

Section 236. additional Ad

Valorem Tax on Idle Lands
P/C/M within Metropolitan Manila
may collect an annual tax of 5%
in addition to the basic real
property tax
Section
237.
Idle
Lands,
Coverage
(a)Agricultural lands:
- more than 1 hectare area
of which remain uncultivated or
unimproved
planted
with
permanent
or
*perennial crops with at least 50
trees to a hectare are not
considered idle lands.
grazing purposes shall likewise not
considered idle lands
(b) Lands located in city or
municipality with more than
1,000 square meters in area
of which remain unutilized or
unimproved

Residential lots in subdivisions duly

approved by proper authorities, the
ownership
of
which
ahs
been

transferred to individual owners, who

shall be liable for the additional tax

Section 238. Idle Lands Exempt

from Tax:
P/C/M within Metropolitan Manila
may exempt idle lands form the
additional levy by reason of *force
majeure, civil disturbance, natural
calamity
or
any
cause
or
circumstance which prevents the
owner of the property or person
having legal interest therein from
improving, utilizing or cultivating
it.

person having legal interest to be

given opportunity to express their
positions or objections on the
oridinance.

Section 243. Fixing the Amount

of Special Levy
It
shall
be
computed
or
apportioned
according to the
books of the assessor concerned

Section
244.
Taxpayers
remedies Against Special Levy
Upon receipt of the written notice
of assessment of the special levy,
avail of the remedies

Section 239. Listing of Idle

Lands by the Assessor.
P/C/M assessor shall make and
keep an updated record of all idle
lands
Section 240. Special Levy by
LGUs
P/C/M may impose special levy on
the lands that benefits from public
work project or improvements
funded by the LGU concerned.
Special Levy shall not exceed 60%
of the actual cost of such projects/
improvements
SL is not applied to land portions
of which have been donated to the
LGU
Section 241.Ordinance Imposing
a Special Levy.
Annual installment payments of
special levy shall be less than 5
nor more than 10 years
Section
242.Publication
of
Proposed Ordinance Imposing a
Special Levy.
The Sangunian concerned shall
conduct a public hearing to notify
the owners of the real property or

Section 245. *Accrual of Special

Levy
-The special levy shall accrue on
the 1st day of the quarter
- Next following the effectivity of
the ordinance imposing such levy.
CHAPTER VI
Collection of Real Property
Tax

Section 246. Date of Accrual of

Tax.
January 1st (If not paid in time it
accumulate penalties)
Section 247. Collection of Tax.
Responsibility of the city or
municipal treasurer concerned
Section 248.Assessor to Furnish
Local Treasurer with Assessment
Roll.
The P/M/C assessor shall prepare
and submit to the treasurer of the
LGU on or before t 31st day of
December
each
year
an
*assessment roll
Section 249. Notice of Time for
Collection of Tax.

The City or Municipal Treasurer

shall post the notice of the dates
when the tax may be paid without
interest at a publicly accessible
place at the city or municipal hall.
Said notice shall be published in a
newspaper of general circulation in
the locality once a week for 2
consecutive weeks
Sanggunian concerned will be
incharged for the prescription of
the dates
Section 250.Payment of Real
Property Taxes in Installments:
Person may pay the basic real
property tax and additional tax for
SEF due thereon without interest in
4 equal installments:
(1st) on or before March 31st
(2nd) on or before June 30
(3rd) on or before September 30
(4rth) on or before Dec. 32st
Except for special levy: the
payment of which shall be
governed by ordinance of the
sanggunian concerned.

Section 251. Tax Discount for

Advanced Prompt Payment.
The Sanggunian concerned may
grant a discount not exceeding
20% of the annual tax due.
Section 252. Payment Under
Protest.
No protest shall be entertained
unless the taxpayer first pays the
tax. There shall be annotated on
the tax receipts the words paid
under protest
Protest filed within 30 days from
payment of the tax
Except for municipalities in Metro
Manila Area who shall decide the
protest within 60 days from
receipt.

Section 253. Repayment of

Excessive Collections.
If tax levied is found to be illegal or
erroneous the taxpayer may file a
written claim for refund or credit
for taxes and interests with the
provincial or city treasurer within 2
years from the date the taxpayer
is entitled to such reduction or
adjustment.
P/C shall decide within 60 days
from receipt
Section
254.
Notice
of
Deliquency in the Paymentof the
Real Property Tax.
Notice of delinquency shall be
posted at the main hall and in a
publicly accessible place in each
barangay of the LGU concerned.
Published once a week for 2
consecutive weeks.
Notice shall specify the date upon
which the tax became delinquent
Delinquent real property will be
sold at public auction and the title
to the property will be vested in
the purchaser to redeem the
property within 1 year from the
date of sale.
Section 255. Interests on Unpaid
Real Property Tax.
2% per month on the unpaid
amount
That in no case shall the total
interest on the unpaid tax or
portion thereof exceed thirty-six
months.

Section 256. Remedies For the

Collection of Real Property Tax
LGU concerned may avail of the
remedies by administration action
thru levy on real property or by
judicial action.

Section 257. Local Government

*Lien
Enforced by administrative or
judicial action and may only be
extinguished upon payment of the
tax and the related interest and
expenses.

Section 261. Redemptioin of

Property sold
-Within 1 year from the date of
sale, the owner of the delinquent
real property or person having
legal interest therein shall hav
ehte right to redeem the property
upon payment to the local
treasurer:
- delinquent tax
Interest
Expenses of sale from the date of
delinquency to the date of sale
Interest of not more than 2% per
month on the purchase price from
the date of sale to the date of
redemption.

Section 258. Levy on Real

Property.
Issuance of a warrant of levy
The levying officer shall submit a
report on the levy to the
sanggunian concerned within ten
days after receipt of the warrant
by the owner of the property or
person
having
legal
interest
therein.
Section 259. Penalty for Failure
to Issue and Execute Warrant.
Any local treasurer or his deputy
who fails to issue or execute the
warrant of levy within 1 year from
the
time
the
tax
becomes
delinquent or within 30 days from
the date of the issuance thereof, or
who is found guilty of abusing the
exercise
thereof
in
an
administrative
or
judicial
proceeding shall be dismissed
form the service.
Section 260.Advertisement and
Sale
After 30 days after service of the
warrant of levy, the local treasurer
shall proceed to publicly advertise
for sale or auction the property
Advertise
through publication
once a week for 2 consecutive
weeks
Within 30 days of sale the local
treasurer or his deputy shall make
a report of the sale to the
sanggunian concerned

Section
262.Final
Deed
to
Purchaser
The validity of sale rests. The
purchaser have it.
Section
263.Purchase
of
Property by the LGUs for Want of
bidder.
-The local treasurer conducting
the sale shall purchase the
property in behalf of the LGU
concerned to satisfy the claim and
within 2 days therafter shall make
a report of his proceedings which
shall be reflected upon the
records of his office.
- within 1 year form the date of
such forfeiture, the taxpayer may
redeem the property by paying to
the local treasurer th full amount
of the real property tax and the
related interest and the costs of
sale.
Section 264. Resale of Real
Estate Taken for Taxes, Fees, or
Charges.
-the
Sanggunian
concerned
maysell and dispose the real
property and the proceeds will

accrue to the general fund of the

LGU concerned.

Section 265. Further Distraint or

Levy
Levy may be repeated if necessary
until the full amount due, including
all expenses, is collected.
Section 266. Collection of Real
Property Tax Through the Courts
Section
267.Action
Validity of Tax Sale

Assailing

Section
268.
Payment
of
Delinquent taxes on Property
Subject of Controversy
Section 269. Treasurer to Certify
Delinquencies
Remaining
Uncollected
Section 270. Periods Within
which to collect Real Property
Taxes.

DEFINITION OF TERMS:
Poll tax in the Philippines Constitution is a
tax that is levied on each citizen to raise
monies to support the government. It is
typically raised in order for that person to
be able to go to the polls to vote.

Appeal is a request to a higher

(appellate) court for that court to review
and change the decision of a lower court.
Per diem (Latin for "per day" or "for each
day") is a daily allowance for expenses
Local Board of Assessment Appeals.
Appelate is having the power to review and
change the decisions of a lower court.
Subpoena is a writ commanding a person
designated in it to appear in court under a
penalty for failure.
Subpoena duces tecum is a writ commanding
a person to produce in court certain
designated documents or evidence.

Provincial/ City Assessors: Tasked in

executing laws and policies relative to
appraisal and assessment of real
properties; involved in the development
and design of policies and procedures in
the valuation and assessment of real
properties
for
taxation
purposes;
implement a systematic method of real
property assessment. In-charge with the
administration and maintenance of real
property identification and accounting
system as well as tax mapping system.
Conducts physical surveys to ascertain

proper
listing
of
real
properties.
Responsible in the preparation and
updating of schedules of fair market
values of different classes of real
properties.
Central Board of Assessment Appeals:
As embodied in Republic Act No. 7160,
the law creating the Central Board of
Assessment Appeals, this office has the
power to hear and decide appeals from the
decision of Municipal Board of Assessment
Appeals in Metro Manila and the City and
Provincial Board of Assessment Appeals
nationwide, relative to the following issues;
(Primary Functions)
(a) All real property tax assessment
cases (Sec. 230, RA 7160); RA
7160 Local Government Code of
1991;
(b) All protests on al realty tax
payments under protest (Sec. 252,
RA 7160); and
(c) All claims from realty tax refund or
credit (Sec. 253, RA 7160).
(d) Protest vs. special levy

Emolument: wage or salary.

Real Property Tax (RPT) is a tax
that owners of real property
need to pay every year so that
the local government unit
(LGU) will not auction off their
property.

Real Property is any subset of

land that
has
been
legally
defined and the improvements to
it have been made by human
efforts
Ad valorem tax: Charge levied as a
percentage of value of the item it is
imposed
on,
and
not
on
the item's quantity, size, weight, or
other such factor. Value added tax
(VAT) and,
generally, import

duties are ad

valorem taxes.

Parsonage is a church house provided

for a member of the clergy.
RA

No.

6938

is

known

as

the

"Cooperative Code of the Philippines."

It is the declared policy of the State to
foster the creation and growth of
cooperatives as a practical vehicle for
prompting
self-reliance
and
harnessing people power towards the
attainment of economic development
and social justice
Special Education Fund: RA 5447 created
an act for SEF to be constituted from the
proceeds of an additional real property tax
and a certain portion of the taxes on
virginia-type cigarettes and duties on
imported leaf tobacco, defining the
activities to be financed, creating school
boards for the purpose, and appropriating
funds therefrom.
Perennial Plant is a plant that lives for more
than 2 years.

Force Majeure: an event or effect that

cannot
be
reasonably
controlled act of God.

anticipated

or

Accrual (accumulation) of something is,

infinance, the adding together of interest or
different investments over a period of time.

Assessment roll containing a list of

all persons whose real properties
have been newly assessed or
reassessed and the values of such
properties.
In law,
a lien is
a
form
ofsecurity
interest granted over an item of propertyto
secure
the
payment
of
a debt or
performance of some other obligation.