Bureau of Local Government Finance Opinion

February 10, 2000 BUREAU OF LOCAL GOVERNMENT FINANCE OPINION 1st Indorsement Respectfully referred to the City Assessor and the City Treasurer, both of Las Pias City, Metro Manila, the within letter dated August 12, 1999 of Mr. Maximo P. Tenorio, President, Pamayanan Samahan ng Bagong Pag-Asa compound, that city, requesting exemption from the payment of real property taxes on the seven (7) parcels of land identified as Lot Nos. 3-A, B, C, D, E, F and H comprising the PSBP community, pursuant to PD 2016. Representations are being made that the landowners of the subject real properties did not pay their real property taxes claiming that they gained nothing from their properties as the same are infested by squatters without their knowledge and consent; and further alleged that payment of subject taxes should be made instead by the actual occupants/residents of the property. Section 3 of Presidential Decree No. 2016 provides as follows: "Sec. 3. Privately-owned land which has been identified and proclaimed as an Area for Priority Development under the ZIP in Metro Manila and SIR Program for the regional cities shall be exempt from the payment of real estate taxes. It appears that the Housing and Land Use Regulatory Board (HLURB), has declared the subject parcel of land as an Area for Priority Development (APD) in Las Pias, per Proclamation No. 1967 as amended by Proclamation N. 2284, per Verification on Locational Reference Handbook adopted by the Board, through Resolution No. 125 dated 01 June 1983. This Bureau, in its 2nd Indorsement dated November 16, 1998, and reiterated under the 1st Indorsement dated January 26, 1999 copies enclosed, ruled that the exemption from the payment of real property taxes pursuant to Sec. 3 of P.D. No. 2016 shall commence the year following the declaration of the property as an Area for Priority Development (APD) under the Zonal Improvement Program (ZIP) for Metro Manila or the Slum Improvement and Resettlement Program (SIRP) for the regional cities. However, it is informed that the exemption of these properties has been withdrawn upon the effectivity of the Local Government Code of 1991 (R.A. No. 7160), particularly under the last paragraph of Section 234 thereof which reads as follows: "SEC. 234. Exemption From Real Property Tax . the following are exempted from payment of real property tax: "xxx xxx xxx." "Except as provided herein, any exemption from payment of real property tax previously granted to, or presently enjoyed by, all persons, whether natural or juridical, including all government-owned or-controlled corporations are hereby withdrawn upon the effectivity of this Code." Accordingly and inasmuch as P.D. No. 2016 took effect only the year following its promulgation in 1986, the subject properties which are occupied by the members of the PSBP should be declared exempt from the payment of real property taxes beginning 1987 up to 1991; and transferred to the Taxable Roll beginning 1992, the year following the Local Government Code of 1991 took effect, considering the withdrawal of exemption provisions of Section 234 thereof and Article III, B(2) of Assessment Regulations No. 3-75, dated February 10, 1975 which provides: "Article III Exemption from the Real Property Tax . DAaHET "xxx xxx xxx. "B. Exemption, commencement and day determined "xxx xxx xxx. "(2) Day as of which exemption determined "If property is not exempt on the tax day, it is liable to taxation for the (fiscal) year although it afterwards becomes exempt. For instance, it has been decided that where land has become liable for taxes, it remains so for that year although subsequently acquired for purposes rendering it exempt (Sec. 712, p. 1499, id .) "xxx xxx xxx." The said City Assessor and the City Treasurer are hereby given instructions to rectify the real property tax assessment and collection records of the subject real properties in accordance herewith. Report of the action taken hereon soonest is requested. (SGD.) ANGELINA M. MAGSINO Deputy Executive Director Officer-in-Charge