Senior Citizen Estate Planning Ordinance

February 10, 2020 Excerpts from the Minutes of the 26th Regular Session of the 8th City Council of Valenzuela Held on February 10, 2020 at 3:16 P.M. at the City Council's Session Hall, 3rd Floor, Legislative Building, Valenzuela City Hall, Karuhatan, Valenzuela City, Metropolitan Manila. VALENZUELA CITY ORDINANCE NO. 649-20 AN ORDINANCE GRANTING TRANSFER TAX EXEMPTION PRIVILEGE ON REAL PROPERTY TRANSACTIONS EXECUTED BY SENIOR CITIZEN RESIDENTS OF VALENZUELA CITY Authored by: Coun. WALTER MAGNUM D. DELA CRUZ Co-Authored by: Coun. ROVIN ANDREW M. FELICIANO WHEREAS , the City Government of Valenzuela is mandated under the 1987 Constitution and the Local Government Code to ensure and support, among other things, the promotion of health and safety, improvement of public morals, maintain peace and order, and preservation of the comfort and convenience of their inhabitants; WHEREAS , Section 16 of Republic Act No. 7160, otherwise known as the Local Government Code of 1991 (hereafter, the "Local Government Code") mandates that every local government unit shall exercise the powers expressly granted, those necessarily implied therefrom, as well as powers necessary, appropriate, or incidental for its efficient and effective governance, and those which are essential to the promotion of the general welfare; WHEREAS , the lack of a sound estate planning and improper administration of real property assets are some of the more prevalent problems that beset senior citizens in our country today; WHEREAS , while recent legislation has granted an amnesty for non-payment of estate taxes and Republic Act No. 10963, otherwise known as the Tax Reform for Acceleration and Inclusion Act , has drastically reduced the imposable taxes on estates of deceased individuals, there is still a need to grant further relief and encourage our Valenzuelano lolos and lolas to practice sound financial estate planning; WHEREAS , Section 135 of the Local Government Code has empowered local government units to impose tax on the sale, donation and barter of real properties at the rate of not more than fifty percent (50%) of one percent of the total consideration involved in the acquisition of the property or the fair market value in case the monetary consideration involved in the transfer is not substantial, whichever is higher; WHEREAS , Section 192 of the Local Government Code likewise empowers local government units to grant tax exemption privileges, though ordinances duly approved, under such terms and conditions as local government units may deem necessary; NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF VALENZUELA CITY IN SESSION ASSEMBLED: CAIHTE ARTICLE I General Provisions SECTION 1. Purpose and Coverage . This Ordinance, which shall be known as the " Senior Citizen Estate Planning Ordinance ," is hereby promulgated for purposes of prescribing the necessary rules and regulations for the grant of transfer tax exemption privilege on real property transactions executed by senior citizen residents of Valenzuela City. SECTION 2. Definition of Terms . For purposes of this Ordinance, the following terms, words, and phrases shall mean or be interpreted as follows: a. Senior Citizen or Elderly shall refer to any resident of Valenzuela City at least sixty (60) years of age duly registered with the Valenzuela City Office of Senior Citizen Affairs; b. Transfer Tax shall refer to taxes levied on the sale, donation and barter of real properties at the rate of not more than fifty percent (50%) of one percent of the total consideration involved in the acquisition of the property or the fair market value in case the monetary consideration involved in the transfer is not substantial, whichever is higher, pursuant to Section 2 of Ordinance No. 373, Series of 2017, as amended, otherwise known as the Valenzuela City Revenue Code; c. Sale shall refer to contract whereby one of the contracting parties obligates himself to transfer the ownership and to deliver a determinable thing, and the other to pay therefor a price certain in money or its equivalent, as governed by the provisions of Title VI of the Civil Code of the Philippines; d. Donation shall refer to an act of liberality whereby a person disposes gratuitously a thing or right in favor of another, who accepts it, as governed by the provisions of Title III of the Civil Code of the Philippines; e. Barter shall refer to a contract whereby one of the parties binds himself to give one thing in consideration of the other's promise to give another thing, as governed by the provisions of Title VII of the Civil Code of the Philippines; f. Dation in payment shall refer to a contract whereby a property is alienated to the creditor in satisfaction of a debt in money, as governed by the provisions of Title VI of the Civil Code of the Philippines; g. Succession shall refer to a mode of acquisition by virtue of which the property, rights and obligations to the extent of the value of the inheritance, of a person are transmitted through his death to another or other by his will or by operation of law, as governed by the provisions of Title IV of the Civil Code of the Philippines; h. Compulsory Heirs shall mean 1. Legitimate children and descendants, with respect to their legitimate parents and ascendants; 2. In default of the foregoing, legitimate parents and ascendants, with respect to their legitimate children and descendants; and 3. Illegitimate children. Children conceived or born during the marriage of the parents are legitimate. Children conceived and born outside a valid marriage are illegitimate, unless otherwise provided under Executive Act No. 209, otherwise known as The Family Code of the Philippines . DETACa i. Family Home shall refer to the dwelling house constituted jointly by the husband and wife or by an unmarried head of a family where they and their family reside, and the land on which it is situated. ARTICLE II Guidelines in Granting Transfer Tax Exemption Privilege SECTION 3. Transfer Tax Exemption Privilege . The sale, donation, barter, or dation in payment of real properties situated in Valenzuela City and registered in the name/s of senior citizen/s shall be exempt from payment of transfer taxes provided the following must concur, to wit: a. The Transfer Certificate of Title, Condominium Certificate of Title, or other evidence of ownership covering the subject real property must be registered in the name/s of senior citizen/s residing in Valenzuela City; Transfer tax due on sale, donation, barter, or dation in payment of real properties owned in common with an individual not categorized as an elderly or an elderly who is not a resident of Valenzuela City shall be proportionately reduced up to the extent of the legal interest of the co-owning senior citizen. b. The sale, donation, barter, or dation in payment of real properties must exclusively be in favor of the senior citizen's compulsory heir/s as buyer, donee or creditor, as the case may be; c. The subject real property must be classified for residential use. Real properties used in business or classified for commercial or industrial use are excluded from the privilege granted in this Ordinance. Provided however, the privilege in this Ordinance shall extend to real properties classified for agricultural use only if the senior citizen/s' family home is situated thereon, only up to the extent of such family home. d. Should the subject real property be classified as a family home, the senior citizen/s must continuously and without interruption reside in such family home during his remaining lifetime. Should the senior citizen be required to cease or suspend his habitation in such family home due to serious medical needs, security threats, or such other meritorious grounds, the buyer, donee or creditor, as the case may be, must submit an Affidavit of Explanation sworn before a Notary Public detailing the circumstance thereof and submit the same with the Office of the City Treasurer and Office of Senior Citizen Affairs within thirty (30) calendar days from date of such cessation or suspension of habitation. The privilege granted in this Ordinance shall not extend to transfer of ownership of real properties by way of succession, whether testate or intestate. SECTION 4. Abandonment of Senior Citizens . Violation of Section 3 (d) hereof shall subject the buyer, donee or creditor, as the case may be, to criminal prosecution under Valenzuela City Ordinance No. 158, Series of 2014, otherwise known as the Protection of the Elderly against Abuse Ordinance . SECTION 5. Record Keeping Requirement . The Office of the City Treasurer and Office of Senior Citizen Affairs are hereby mandated to maintain a record of all availments of privilege pursuant to this Ordinance. aDSIHc ARTICLE III Final Provisions SECTION 6. Separability Clause . Should any provision in this Ordinance, or application of such provision to any circumstance, is declared invalid or unconstitutional, the other provisions not affected thereby shall remain valid and subsisting. SECTION 7. Implementing Rules and Regulations . Within sixty (60) days from the publication of this Ordinance, the Offices of the City Assessor and City Treasurer shall promulgate the rules and regulations to effectively implement the provisions of this Ordinance. SECTION 8. Effectivity . This Ordinance shall be effective for a period of two (2) years from the issuance of the implementing rules and regulations prescribed in the immediately preceding Section and its publication as required under the Local Government Code. ENACTED. FEBRUARY 10, 2020, VALENZUELA CITY, METROPOLITAN MANILA. (SGD.) HON. ROVIN ANDREW M. FELICIANO Councilor Majority Floor Leader (SGD.) HON. CRISSHA M. PINEDA Councilor Minority Floor Leader (SGD.) HON. KIMBERLY ANN GALANG-TIANGCO Councilor Asst. Majority Floor Leader HON. RICARDO RICARR C. ENRIQUEZ Councilor Asst. Minority Floor Leader (SGD.) HON. RAMON L. ENCARNACION Councilor (SGD.) HON. KRISTIAN ROME T. SY Councilor ( SGD.) HON. JENNIFER PEREZ PINGREE Councilor (SGD.) HON. NIA SHIELA B. LOPEZ Councilor (SGD.) HON. JOSEPH WILLIAM D. LEE Councilor (SGD.) HON. LOUIE P. NOLASCO Councilor (SGD.) HON. WALTER MAGNUM D. DELA CRUZ Councilor (SGD.) HON. CHIQUI MARIE N. CARREON Councilor (SGD.) HON. BIENVENIDO S. BARTOLOME, JR. Councilor (President, League of Barangays) (SGD.) HON. EXEQUIEL D.J. SERRANO Councilor (President, Sangguniang Kabataan Federation) ATTESTED: (SGD.) ANTONIO R. ESPIRITU Secretary CERTIFIED CORRECT: (SGD.) HON. LORENA NATIVIDAD-BORJA City Vice Mayor Presiding Officer APPROVED: (SGD.) HON. REXLON T. GATCHALIAN City Mayor Date Signed: February 24, 2020