Bureau of Local Government Finance Opinion

June 26, 2000 BUREAU OF LOCAL GOVERNMENT FINANCE OPINION 2nd Indorsement Respectfully returned to the Municipal Assessor, Taguig, Metro Manila, his within preceding 1st Indorsement dated June 15, 2000, relative to the letter dated June 9, 2000 of the Trust Legal Assistant, Asset Privatization Trust (APT), requesting opinion on the real property tax liabilities of the Philippine Polysterene Paper Corporation (PPPC), a government corporation whose title to and possession of its properties were transferred to (APT) on February 27, 1987; and thereupon to issue tax declarations on the parcels of land described under Transfer Certificate of Title (TCT) Nos. 20121, 20122, and 20123, all located in Barrio Bagumbayan, Taguig, Metro Manila, under the name of the Government of the Republic of the Philippines. IAEcaH Under his letter dated June 9, and May 5, 2000, addressed to that Office and the Municipal Treasurer, respectively, the Trust Legal Assistant of the APT, made representations that the subject parcels of land were transferred to the National Government pursuant to Proclamation No. 50 dated December 8, 1986, of the then President Corazon C. Aquino; and Administrative Order No. 14 and a Deed of Transfer between the Government of the Philippines and the Development Bank of the Philippines dated February 27, 1987. Section 35 of Proclamation No. 50 and Section 234(a) R.A. No. 7160, otherwise known as the Local Government Code of 1991 provide as follows: Section 35, Proclamation No . 50 : "SEC. 35. Exemption from Taxes, Fees and Other Charges . The provisions of any law to the contrary notwithstanding, the Trust as well as the corporations and assets held by it, shall be exempt from all taxes, fees, charges, imposts, and assessments arising from or occasioned by the passing of title over such corporations or assets from the government institutions to the Trust and or from the Trust to a private acquisitor or buyer imposed by the National Government or any subdivision thereof including but not limited to stock transfer taxes, capital gains taxes, documentary stamps, registration fees and the like; Provided, that in case the said government institutions acquired the said assets by foreclosure, the non-payment of similar taxes, fees, charges, imposts and assessments shall not be a bar to the consolidation of title in the foreclosing institutions and the subsequent passing of title to the Trust or the corporations held by the Trust . (Emphasis ours) Section 234(a), R . A . No . 7160 : "SEC. 234. Exemption from Real Property Tax . The following are exempt from Real Property Taxes:" "(a) Real Property Owned by the Republic of the Philippines or any of its political subdivisions except when the beneficial use thereof has been granted, for consideration or otherwise, to a taxable person. "xxx xxx xxx." Clearly, real property owned by the government is exempt from payment of real property tax, except when the beneficial use thereof has been granted for consideration or otherwise, to a taxable person. In this particular case, the subject real property, the title to and possession thereof, were transferred to APT, by virtue of the aforecited Proclamation No. 50, are thereof likewise exempt from real property taxes. It is worthwhile mentioning hereon that the Department of Finance (DOF), thru the Bureau of Local Government Finance (BLGF), in its 2nd Indorsement dated January 21, 1993, copy attached, ruled, among others, that "in dealing with real properties owned by APT, the same should be regarded as properties owned by the Government. Any exemption therefore granted to the Government must automatically inure also to APT." Viewed in the light of the foregoing, and in pursuance of Section 234(a) of the Local Government Code of 1991 and Section 35 of Proclamation No. 50 of the then President Corazon C. Aquino, that Office is hereby directed to issue tax declarations on the subject parcels of land described under Transfer Certificates of Title (TCT) Nos. 20121, 20122, and 20123, under the name of the Republic of the Philippines. Be guided accordingly. (SGD.) ANGELINA M. MAGSINO Deputy Executive Director Officer-in-Charge