Bureau of Local Government Finance Opinion

November 27, 2003 BUREAU OF LOCAL GOVERNMENT FINANCE OPINION 1st Indorsement Respectfully referred to the City Assessor, Pasig City, Metro Manila, the within letter dated October 28, 2003 of the General Manager, National Development Company (NDC), NDC Building, Salcedo Village, Makati City, requesting opinion in behalf of the National Steel Corporation (NSC) on the exemption from real property tax of machineries that ceased operations. In the attached letter of even date, the Liquidator of NSC requested the exclusion of NSC's Pasig Plant Machinery from the roll of taxable real properties; and consequently are no longer subject to real property tax due to cessation of operations. Apparently, a favorable consideration of the request from that office is requested to cause the issuance of a demolition permit to the demolition contractor of LNP International Inc., the company to whom the sale of NSC's Pasig was allegedly awarded. It may be recalled that in its letter dated July 30, 2003, copy attached, addressed to the Liquidator, NSC, Iligan City, the BLGF, citing previous rulings on the matter, has consistently ruled that when machineries are no longer actually, directly and exclusively used to meet the needs of a particular industry, business or activity, the same should no longer be subject to real property tax. AEIHCS Likewise, attached is a Certification dated October 17, 2003, from the Treasurer of NSC attesting to the fact that LNP International Inc., has executed a Contract of Sale on August 11, 2003 with NSC with respect to NSC's Pasig Plant Assets, consisting of, among others, machineries and equipment. In this regard and subject to the determination of that office that the subject machineries of NSC, Pasig City Plant are indeed no longer used for its intended purpose, the same should be dropped from the Roll of Taxable Real Properties and entered in the Exempt Roll of Real Properties. Be guided accordingly. (SGD.) MA. PRESENTACION R. MONTESA Executive Director