Real Property Tax Code

Section 86

Distribution of proceeds. (a) The proceeds of the real property tax, except as otherwise provided in this Code, shall accrue to the province, city or municipality where the property subject to the tax is situated and shall be applied by the respective local government unit for its own use and benefit. (b) Barangay shares in real property tax collections. Beginning January 1, 1978 and thereafter, the annual shares of the barangays in the basic real property tax collections shall be as follows: (1) Ten per cent of the total annual collections of the province and the municipality shall accrue to the barangay where the property subject to the tax is located. (Amending Section 86, Paragraph (b) of Presidential Decree Numbered Four Hundred Sixty Four, Otherwise Known as the Real Property Tax Code, Presidential Decree No. 1230, [November 4, 1977]) (2) In the case of the city, ten per cent of the collections of the tax shall likewise accrue to the barrio where the property is situated. Thirty per cent of the barrio shares herein referred to may be spent for salaries or per diems of the barrio officials and other administrative expenses, while the remaining seventy per cent shall be utilized for development projects approved by the Secretary of Local Government and Community Development or by such committee created, or representatives designated, by him.

Section 87

Application of proceeds. (a) The proceeds of the real property tax pertaining to the city and to the municipality shall accrue entirely to their respective general funds. In the case of the province, one-fourth thereof shall accrue to its road and bridge fund and the remaining three-fourths, to its general fund. (b) The entire proceeds of the additional one per cent real property tax levied for the Special Education Fund created under Republic Act No. 5447 collected in the province or city on real property situated in their respective territorial jurisdictions shall be distributed as follows: (1) Collections in the provinces: Fifty-five per cent shall accrue to the municipality where the property subject to the tax is situated; twenty-five per cent shall accrue to the province; and twenty per cent shall be remitted to the Treasurer of the Philippines. (2) Collections in the cities and in the cities and municipalities of Metro Manila: Eighty percent shall be retained by cities; including cities and municipalities of Metro Manila, and twenty per cent shall be remitted to the Treasurer of the Philippines. (Amending Sections 41 and 87 of P.D. No. 464 As Amended (Real Property Tax Code), Presidential Decree No. 1913, [March 29, 1984]) However, any increase in the shares of provinces, cities and municipalities from said additional tax accruing to their respective local school boards commencing with fiscal year 1973-74 over what has been actually realized during the fiscal year 1971-72 which, for purposes of this Code, shall remain as the base year, shall be divided equally between the general fund and the special education fund of the local government units concerned. The Secretary of Finance may, however, at his discretion, increase to not more than seventy-five per cent the amount that shall accrue annually to the local general fund. (c) The proceeds of all delinquent taxes and penalties, as well as the income realized from the use, lease or other disposition of the real property acquired by the province or city at a public auction in accordance with the provisions of this Code, and the proceeds of the sale of the delinquent real property or of the redemption thereof, shall accrue to the province, city or municipality in the same manner and proportions as if the tax or taxes had been paid in regular course. (d) The proceeds of the additional real property tax on idle private lands shall accrue to the respective general funds of the province, city and municipality where the land subject to the tax is situated. (e) The provisions of existing laws to the contrary notwithstanding the proceeds of the Special Education Fund accruing to the local governments may be used for the salary adjustment of teachers of the national government, in addition to the other purposes mentioned in Section 1 of Republic Act No. 5447, as amended. (Amending Sections 41 and 87 of P.D. No. 464 As Amended (Real Property Tax Code), Presidential Decree No. 1913, [March 29, 1984])