Bureau of Local Government Finance Opinion

May 14, 2003 BUREAU OF LOCAL GOVERNMENT FINANCE OPINION 2nd Indorsement Respectfully returned to the Regional Director for Local Government Finance, Region I, 2nd Floor, Mabanag Justice Hall Building, Governor Luna Street, San Fernando City, the herein preceding indorsement relative to the letter dated January 16, 2003 of the Municipal Mayor of Tagudin, Ilocos Sur, requesting advice on whether or not the municipality of Tagudin is authorized to decrease rates of taxes, fees and/or charges contained in Ordinance No. 05, series of 1999, otherwise known as "The Revised Revenue Code of the Municipality of Tagudin, Ilocos Sur." cSIADa In this connection, it may be stated that local government units may, at any time thru an ordinance, adjust downwards the rates of any existing tax, fee or charge, or even abolish altogether, unless it is among the so-called mandatory impositions under the Local Government Code (LGC) of 1991 and its Implementing Rules, the rates of which are declared by law or regulations to be uniform throughout certain levels of the local government units. The adjustment however of the tax rates whether upwards or downwards should not exceed ten percent (10%) as prescribed in Section 191 of the LGC. In this regard, however, due consideration should be given to the impact of possible revenue losses upon the financial position of the local government unit. The Municipality should propose measures to compensate the losses and augment the needed funds for the efficient and effective delivery of basic services and facilities. Likewise, in the said letter, the Municipal Mayor claims that the Revised Revenue Code of Tagudin was passed by the Sangguniang Bayan on November 8, 1999 and received by the Sangguniang Panlalawigan of Ilocos Sur on December 1, 1999. It was then presumed that said Code was consistent with laws and therefore valid since no action had been taken by the Office of the Sangguniang Panlalawigan within thirty (30) days after its submission, pursuant to Section 56 (d) of RA 7160. Section 56 (d) of the LGC of 1991 provides as follows: "Section 56. Review of Component City and Municipal Ordinances or Resolutions by the Sangguniang Panlalawigan . (a) . . . "(d) If no action has been taken by the sangguniang panlalawigan within thirty (30) days after submission of such an ordinance or resolution, the same shall be presumed consistent with law and therefore valid." It is clear from the aforequoted provision of the law that the Municipality of Tagudin, Ilocos Sur can implement its Revised Revenue Code if after the lapse of 30 days from submission, no action has been made thereon. Be guided accordingly. IEHDAT (SGD.) MA. PRESENTACION R. MONTESA Executive Director