In January, I wrote on real property tax (RPT) or more commonly known as “amilyar,” an ad valorem tax levied on real property determined on the basis of a fixed proportion of the value of the property. The rate for municipalities and cities in Metro Manila is two percent while in the provinces it is one percent.
For today’s column, I present a comparison of the different real property tax rates of the various cities and municipalities in Metro Manila. The information was obtained from the LGU’s websites and verified through their respective Assessor’s Offices.
The RPT is the amount paid on or before Jan. 31 of each year. In addition to the basic RPT, Local Government Units (LGUs) assess additional Special Education Fund (SEF) and an ad valorem tax on idle lands.
To compute the tax, you multiply the RPT rate by the assessed value. The assessed value or taxable value is the fair market value of the real property multiplied by the assessment level. The assessment level is fixed by the LGU through local ordinances.
RPT = RPT RATE X ASSESSED VALUE
On the other hand, the assessed value (AV) is the fair market value (FMV) of the property multiplied by the assessment level. The assessment level is fixed by the LGU through local ordinances while the fair market value is the price at which a property may be sold by a seller who is not compelled to sell and bought by a buyer who is not compelled to buy. For assessment purposes, real property is classified as residential, agricultural, commercial, industrial, mineral, timberland or special. The LGU concerned has the power to classify lands through their respective councils. Real property shall, however, be classified, valued and assessed on the basis of its actual use regardless of where located, whoever owns it, and whoever uses it.