OCT.

24, 2011 DATE

NR # 2566B
REF. NO.

Congress moves to correct corruption-prone land valuation system

To enhance the capacity of local government units to generate local revenues from real property, the House Committee on Government Reorganization is finalizing the proposed Real Property Valuation and Assessment Reform Act of 2011. We are finalizing a substitute bill, a consolidation of five separate but similar bills which would develop and maintain realistic and uniform standards for real property valuation in the country, revealed Rep. Cesar Jalosjos, committee chairman. Authors of the measures being consolidated are Majority Leader Neptali Gonzales II and Reps. Rodolfo Biazon (HB Nos. 212 and 1164); Diosdado M. Arroyo and Gloria Macapagal-Arroyo (HB 4610) and Mel Senen Sarmiento, Rufus Rodriguez and Maximo Rodriguez, Jr. (HB Nos. 4440 and 4687). Gonzales said the bill intends to remove the existence of a multiple, unrealistic and corruption-prone system of land valuation and to correct inefficiencies in the allocation and utilization of the land market. Biazon stressed the vitality of restoring the confidence of the public and investors in the real property sector while improving the income and revenues of the government, especially the LGUs from real property. It would be an opportunity to develop and professionalize the valuation practice in the country and clarify the function of valuing and appraising real properties from the function of administering the taxes thereon, Arroyo said. Sarmiento and the Rodriguez brothers stressed the need for the BLGF to develop and maintain an up-to-date electronic database of the sale, exchange, lease, and all other real property transactions in the country and that the basis of taxation shall be the current market value prevailing in the locality where the property is located. Under the still unnumbered substitute bill, the strengthened Bureau of Local Government Finance (BLGF), through the Real Property Valuation Service (RPVS) as hereinafter established, shall lead and manage the implementation of the provisions of the proposed act. Valuation and appraisal refers to the systematic and analytic determination and recording of property facts, circumstances, investments, and investigation of other relevant data resulting in a supportable estimate and opinion of value or a professional

OCT. 24, 2011 DATE

NR # 2566B
REF. NO.

conclusion based upon supporting data, logical analysis and judgment as of a specific date and for a specific purpose. The bill will establish a Central Consultative Committee chaired by the BLGF Executive Director and composed of a representative each from the following: Bureau of Internal Revenue; Department of Environment and Natural Resources; the Bangko Sentral ng Pilipinas; National organization of government assessors; National organization of appraisers on national government agencies; Private appraisal sector; and the Union of Local Authorities of the Philippines. The Chairperson and members of the Committee, which shall meet at least once every semester or as often as necessary for the adoption of valuations standards, shall not receive additional salary for the performance of their functions, but they shall be entitled to honoraria, pursuant to existing laws and regulations. For the effective implementation of the proposed Act, the BLGF shall, among others, develop and conduct the necessary trainings of all local assessors and other local officials/staff on the preparation of Schedule of Market Values (SMVs) in accordance with internationally accepted valuation standards, concepts, principles and practices. The proposed statute stipulates penal provisions (from fines to suspension of concerned officials) for failure to comply with: the required submission of documents; the valuation standards; and failure to prepare scheduled market values. The proposed Act also provides for taxpayers remedies in case of erroneous assessments of real properties. (30) dpt