Article 142p. 142

NATIONAL INTERNAL REVENUE CODE TAXATION, TARIFF and CUSTOMS LAWS

The ordinance fixing the rate of real property tax shall

remain in full force and effect unless amended on or

before September fifteenth of the year next preceding

the one in which the amendment is to take effect. Any

ordinance reducing the existing rates of real property tax

shall be subject to review by the Secretary of Finance who

shall act thereon within sixty days upon receipt of a copy

thereof; otherwise, the reduced rates shall be deemed

effective on the first day of January of the succeeding

year.

Section 40. Exemptions from Real Property Tax. The

exemption shall be as follows:

(a)

Real

property

owned

by

the

Republic

of

the

Philippines or any of its political subdivisions and any

government-owned corporation so exempt by its charter:

Provided; however, That this exemption shall not apply to

real property of the abovenamed entities the beneficial

use of which has been granted, for consideration or

otherwise, to a taxable person.

(b) Non-profit cemeteries or burial grounds.

(c)

Charitable

institutions,

churches,

personages

or

convents appurtenant thereto, mosques, and all land,

buildings,

and

improvements

actually,

directly

and

exclusively used for religious or charitable purposes.

(d)

Real

property

in

any

one

city or municipality

belonging to a single owner, the entire assessed valuation

of which is not in excess of one thousand pesos; Provided,

however, That the property so exempt shall be assessed

and records thereof kept as in other cases. (Amendments

to Certain Sections of P.D. No. 464 As Amended (Real

Property Tax Code), Presidential Decree No. 1621, [April 19,

1979])

(e) Land acquired by grant, purchase of lease from the

public domain for conversion into dairy farms for a period

of five years from the time of such conversion; and

machinery of a pioneer and preferred industry as certified

by

the

Board

of

Investments used or operated for

industrial,

agricultural,

manufacturing

or

mining

purposes, during the first three years of the operation of

the machinery. (as amended by PD 1383)

(f) Perennial trees and plants of economic value, except

where

the

land

upon

which

they

grow

is

planted

principally to such growth.

(g) Real property exempt under other laws.

(h)

pasture and/or grazing lands acquired by grant,

purchase, or lease from the public domain, actually used

for

livestock

production,

for

a

period

of

five

years

beginning with calendar year 1977, and for acquisitions

made thereafter, the exemption shall begin with the year

of such acquisition (Amending Section 40 of P.D. No. 464

(Real Property Tax Code), Presidential Decree No. 939,

[May 29, 1976])

CHAPTER V SPECIAL LEVIES ON REAL

PROPERTY

Section 41.

An additional one per cent tax on real

property for the Special Education Fund. — There is

hereby imposed an annual tax of one per cent on real

property to accrue to the Special Education Fund created

under Republic Act No. 5447, which shall be in addition to

the basic real property tax which local governments are

authorized to levy, assess, and collect under this Code:

Provided, That real property granted exemption under

Section 40 of this Code shall also be exempt from the

imposition

accruing

to

the

Special Education Fund.

(Amendments to Certain Sections of P.D. No. 464 As

Amended (Real Property Tax Code), Presidential Decree

No. 1621, [April 19, 1979], Presidential Decree No. 1913,

[March 29, 1984])

Section 42. Additional ad valorem tax on idle lands. a.

There is hereby imposed an additional real property tax

on idle lands at the rate of FIVE PER CENT PER ANNUM

based

on

the

assessed

value

of

the

property

as

determined by the Provincial or City Assessor of the

Province or City where the property is located, or by the

Municipal Assessor in the case of idle lands situated in the

municipalities of Metropolitan Manila.

b. The additional ad valorem tax levied in the preceding

paragraph shall begin to accrue on July 1, 1978, any

provision

of

law

to

the

contrary

notwithstanding.

(Amending P.D. No. 464 (Real Property Tax Code) Re:

Additional Tax on Idle Lands, Presidential Decree No.

1446, [June 11, 1978])

Section 43. Idle lands, coverage. For purposes of this

Decree, idle lands shall include the following:

a. Agricultural lands suitable for cultivation, dairying,

inland fishery, and other agricultural uses, one half of

which remain uncultivated or unimproved by the owner

or owners thereof.

b. Lands, other than agricultural, located in a City or

Municipality, more than 2,000 square meters in area one

half of which remain unutilized or unimproved by the

owner or owners thereof. This Section shall likewise apply

to residential lots in subdivisions duly approved by proper

authorities, the ownership of which has been transferred

to individual owners, who shall be liable for the additional

tax. Individual lots of such subdivisions, the ownership of

which has not been transferred to the buyer shall be

considered as forming part of the subdivision, and shall

be subject to the additional tax payable by subdivision

operator. (Amending P.D. No. 464 (Real Property Tax

Code) Re: Additional Tax on Idle Lands, Presidential

Decree No. 1446, [June 11, 1978])

Section 44. Idle lands exempt from tax. The additional

levy on idle lands shall not apply to landowners who are

unable to improve, utilize or cultivate their lands due to

any of the following causes:

a. Adverse peace and order conditions as certified by the

Provincial Commander of the Philippine Constabulary.

However, if within one year upon restoration of the peace

and order in the locality as certified by the said Provincial

Commander,

the

said

land

remains

unimproved,

unutilized,

uncultivated,

the

additional

tax

provided

under Section forty two hereof shall be imposed.

b. Financial losses of the owner due to fire, flood, typhoon,

earthquake and other causes of similar nature declared

by the owner in a sworn statement to be submitted to the

Provincial, City or Municipal Assessor stating the ground

or grounds therefore, which shall be accompanied by a

certification

from

the

proper

agency

of

the

local

government concerned. If the idle land is not improved to

the extent prescribed in the next preceding Section

within two years from the date of the occurrence of the

loss, the tax provided under Section forty-two hereof shall

be imposed subject to rules and regulations issued in

connection herewith.

c. Existing court litigations involving the land subject to

tax mentioned in this chapter as certified by the Court

under which the case is pending unless said land is not

improved within one year after the final adjudication of

the case to the extent provided in the next preceding

Section, in which case, the tax provided under Section

forty-two hereof shall be imposed.

d. Necessity to leave the land in a fallow state as certified

by the Provincial, City or Municipal Agriculturist, or in their

absence, by the Secretary of Agriculture or his duly

authorized representatives, stating among others, the

length of time within which the land shall be considered

ready for production. If the idle land is not improved

within one year after the termination of such period of

time, the tax provided under Section forty-two hereof

shall be imposed.

e. Unfavorable physical factors such as rocky nature of

ground,

and

uneven

topography

in

the

case

of

agricultural land, which render the land unsuitable for

cultivation as certified by the Provincial, City or Municipal

© Compiled by RGL

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