Bureau of Local Government Finance Opinion

March 24, 1993 BUREAU OF LOCAL GOVERNMENT FINANCE OPINION 1st Endorsement Respectfully referred to the Provincial Treasurer, Malolos, Bulacan. This refers to the attached letter, dated December 28, 1992, of Mr. Francisco R. Illescas, Jr.,President, Bulacan Aggregates and Truckers Organization (BATO),Inc. of San Roque, Angat, that province. Mr. Illescas is requesting proper interpretation of the provisions of Sec. 138 of the Local Government Code of 1991, quoted hereunder: "Sec. 138. Tax on Sand, Gravel and Other Quarry Resources . The province may levy and collect not more than ten percent (10%) of 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, as amended, extracted from public lands or from the beds of seas, lakes, rivers, streams, creeks, and other public waters within its territorial jurisdiction. "xxx xxx xxx" The query is whether the fair market value means the value of the mineral "as extracted in site" or the market value "as delivered to the end user". In this connection, it is the view of this Department that the fair market value should be the value of mineral as extracted in site for reason that the assessment of the tax due by the Provincial Treasurer is done on or before extraction of said materials and not upon the sale thereof to end users. Accordingly, information is requested on how that Office determines the tax due from those who extract said materials and whether the same is imposed in an existing provincial tax ordinance or not. acd By Authority of the Secretary: LORINDA M. CARLOS Executive Director Bureau of Local Government Finance