Local Government Taxation

in the Philippines
Local Government Taxation in the
Philippines is based on Republic
Act 7160, otherwise known as
Local Government Code of 1991
which was signed into law on 10
October 1991 and took effect on 1
January 1992.

Power to Create Sources of

Revenue
(Sec. 129)
Each local government unit (LGU) has the
power to create its own sources of revenue
and to levy taxes, fees, and charges
The grant of power to create sources of
revenue is consistent with the basic policy
of local autonomy
The taxes, fees and charges shall accrue
exclusively to the LGUs

Sec. 133 - Common Limitations on the

Taxing Powers of Local Government
Units
a. Income tax, except when levied on banks
and other financial institutions;
b. Documentary stamp tax;
c. Taxes on estates, inheritance, gifts,
legacies and other acquisitions mortis
causa, except as otherwise provided herein;
d. Customs duties, registration fees of
vessel and wharfage on wharves, tonnage
dues , and all other kinds of customs fees,
charges and dues except wharfage on
wharves constructed and maintained by the
local government unit concerned;

e. Taxes, fees and charges and other

impositions upon goods carried into or
out of, or passing through, the
territorial jurisdictions of local
government units in the guise of
charges for wharfage, tools for
bridges or otherwise, or other taxes,
fees and charges in any form
whatsoever upon such goods or
merchandise;
f. Taxes, fees and charges on
agricultural and aquatic products
when sold by marginal farmers or
fisherman.

g. Taxes on business enterprises

certified to by the Board of
Investments as pioneer or nonpioneer for a period of six (6) and
four (4) years, respectively from the
date of registration.
h. Excise taxes on articles enumerated
under the National Internal Revenue
Code, as amended, and taxes, fees
or charges on petroleum product
i. Percentage or value-added tax (VAT)
on sales, barters or exchanges or
similar transactions on goods or
services except as otherwise
provided herein;

j. Taxes on the gross receipts of

transportation of passengers of freight by
hire and common carriers by air, land or
water, except as provided in this code.
k. Taxes on premiums paid by way of
reinsurance or retrocession
l. Taxes , fees and charges for the
registration of motor vehicles and for the
issuance of all kinds of licenses or
permits for the driving thereof, except
tricycles;
m. Taxes, fees and other charges on
Philippine products actually exported,
except as otherwise provided herein;

n. Taxes, fees and charges, on

Countryside and Barangay Business
Enterprises and cooperative duly
registered under R.A. No. 6810 and
Republic Act Numbered Sixty-nine
hundred thirty eight (R.A. No. 6938)
otherwise known as the cooperative
code of the Philippines respectively;
and
o. Taxes, fees or charges of any kinds
on the National Government, its
agencies and instrumentalities, and
Local Government Units.

1.) GENERAL FUND USED TO ACCOUNT FOR

SUCH MONIES AND RESOURCES AS MAY BE
RECEIVED BY AND DISBURSED FROM THE LOCAL
TREASURY.
2.) SPECIAL EDUCATION FUND SHALL CONSIST
OF THE RESPECTIVE SHARES OF PROVINCES,
CITIES , MUNICIPALITIES, AND BARANGAYS IN
THE PROCEEDS OF THE ADDITIONAL TAX ON
REAL PROPERTY.
3.) TRUST FUND SHALL CONSIST OF PRIVATE
AND PUBLIC MONIES WHICH HAVE OFFICIALLY
COME INTO THE POSSESSION OF THE LGU OR OF
A LOCAL GOVERNMENT OFFICAIL AS TRUSTEE,
AGENT OR ADMINISTRATORR, WHICH HAVE BEEN
RECEIVED AS A GUARANTY FOR FULFILLMENT OF
SOME OBLIAGATION.

SOURCES OF INCOME FOR

LOCAL GOVERNMENT UNITS
I. LOCAL SOURCES
a) Real Property Taxes
b) Business Taxes
c) Non-tax Revenues
II. EXTERNAL SOURCES
a) Internal Revenue Allotment
b) National Aids
c) National Wealth
III. BORROWINGS

REAL PROPERTY TAX

The province or city or municipality within the
Metropolitan Manila area shall fix a uniform
rate of basic real property tax.

A. Province - at rate not exceeding 1% of the

assessed value of the real property.
Province
35%
Municipality
40%
Barangay
25%
B. City or Municipality within Metropolitan
Manila Area - at rate not exceeding 2% of
the assessed value of real property.
City
70%
Barangay
30%

Formula in Computing
Real Property Tax
FMV x AL = AV
AV x Rate = RPT
Assessment level
Residential
Where :
Commercial
FMV = Fair Market
Industrial
Value
Machinery
AL = Assessment Level
Commercial
AV = Assessed Value
Industrial

LGC

Q.C.

20%

15%

50%

40%

50%

40%

80%
-

70%

50%

REAL PROPERTY TAX

Special Levy on Real Property for Special Educational Fund
A. province or city or a municipality within the Metropolitan
Manila area may levy and collect an annual tax of 1% on the
assessed value of real property in addition to the basic real
property tax.
Additional ad Valorem Tax on Idle Lands
B. Manila area may levy an annual tax on idle lands at the rate
not exceeding 5% of the assessed value of the property in
addition to the basic real property tax.
Real Property for Assessment Purpose
Classes
1) Residential
2) Agricultural
3) Commercial
4) Industrial
5) Mineral
6) Timberland

Types
1. Land
2. Building
3. Machineries

Local Business Taxes

Revenues
Taxes - enforced contribution
Kinds:
1. Property taxes
2. Business and other taxes
Receipts
Fees imposed on the exercise of
regulatory powers
Charges cost recovery impositions
for services delivered or use of
facilities

BUSINESS TAXES

TAXING POWERS OF LOCAL GOVERNMENT UNITS

PROVINCES - They may collect taxes, fees and charges

on:
1) Tax on Transfer of Real Property Ownership - at rate
not more than 50% of 1% of total consideration
2) Franchise Tax - at rate not exceeding 50% of 1 % of
the gross receipts for the preceding calendar year
3) Tax on Sand, Gravel and Other Resources - at rate
not more than 10% of fair market value
4) Tax on Business of Printing and Publication -at rate
not exceeding 50% of 1%
5) Professional Tax - at rate not more than
P 300.00 annually
6) Amusement Tax - at rate not more than 30% of gross
receipts from admission fees
7) Annual fixed Tax for every Delivery Truck, or Van of
Manufacturers or Producers, Wholesalers of, Dealers,
or Retailers in, Certain Products - at rate not
exceeding P 500.00 annually.

TAXING POWERS OF LOCAL

GOVERNMENT UNITS

MUNICIPALITIES - They may collect taxes, fees and

charges not otherwise levied by provinces.
1.) Manufacturer - at rate not exceeding 37 1/2 %
of 1% of gross sales or receipts for the
preceding calendar year.
2.) Wholesalers - at rate not exceeding 50% of 1 %
of gross sales or receipts for the preceding
calendar year.
3.) On Exporters, Manufacturers, Wholesalers or
Retailers of essential commodities - at rate not
exceeding 1/2 of the rate prescribed under
letters A, B, and D.
4.) Retailers -at rate with gross sales or receipts
for the preceding calendar year or
P 400,000 or less
2% per annum
More than P 400,000
1% per annum

5.) Contractors at rate not exceeding 50%

of 1% on the gross sales or receipts for
the preceding calendar year.
6.) Banks and other financial Institution
at rate not exceeding 50% of 1% on the
gross receipts of the preceding calendar
year derived from interest, commissions
and discounts from lending activities.
7.) Peddlers at rate not exceeding P 50.00
annually.
8.) On any business, not otherwise
specified at rate not exceeding 2% of
gross sales or receipts of the preceding
calendar year.

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TAXING POWERS OF LOCAL

GOVERNMENT UNITS
CITIES - They may levy taxes, fees and charges which the
province or municipalities may impose and may exceed the
maximum rates allowed for provinces or municipalities by not
more than 50% except the rates for professional and
amusement taxes.
BARANGAY - They may levy taxes, fees and charges which shall
exclusively accrue to them.
1) Taxes - on stores or retailers with gross sales or
receipts of the preceding calendar year of P 50,000 or less
in the case of cities and P 30,000 or less in the case of
municipalities.
2) Service Fees and Charges - they may collect reasonable
fees or charges for services rendered.
3) Barangay Clearance - no city or municipality may issue
any license or permit unless a clearance is first obtained
from the barangay at reasonable rate.
4) Other Fees and Charges - reasonable fees and charges.

BARANGAY INCOME
SOURCES
I. Internal Revenue Allotment
(IRA)
II. Real Property Tax (RPT)
III. Barangay Taxing Power
IV. Community Tax

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SHARES OF LOCAL GOVERNMENT UNITS IN

THE PROCEEDS OF NATIONAL TAXES
A. INTERNAL REVENUE ALLOTMENT - Local government
units shall have a share in the national internal revenue
taxes based on the collection of the third fiscal year
preceding the current fiscal year at 40% allocated in the
following manner.
1) Provinces

23%

2) Cities

23%

3) Municipalities

34%

4) Barangays

20%

The share of each province, city and municipality shall

be determined on the bases of the following formula.
a) Population

50%

b) Land Area

25%

c) Equal Sharing

25%

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B. SHARES OF LGU IN THE PROCEEDS

OF NATIONAL WEALTH - Local
government units shall have an
equitable share in the proceeds
derived from the utilization and
development areas at 40% of the
gross collection derived by the
national
government
from
the
preceding year from mining taxes,
royalties, forestry and fishery charges
in addition to the internal revenue
allotment.

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Tax on Transfer of Real

Property
Tax subject: sale, donation, barter or any
mode of transfer of ownership or title of real
property
Tax rate: not to exceed
Tax Base
Provinces
Fair market value,
50% of 1%
or total consideration
whichever is higher

Cities
75% of 1%

Tax on Transfer of Real

Property
payment must be made within 60 days
from date of execution of deed or from
date of owners death
proceeds not shared
exemption: disposition of real property
under CARP (Republic Act No. 6657)

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Tax on Business of Printing

and/or Publication
Tax subject: printing and/or publication of
books, cards, posters, leaflets, handbills,
certificates, receipts, pamphlets, and
printed materials of similar nature
Tax rate: not to exceed
Tax Base
Provinces
Cities
Gross receipts
50% of 1%
75% of 1%
Capital investment
For start-ups
1/20 of 1%

3/40 of 1%

Tax on Business of Printing

and/or Publication
Capital Investment
The capital which a person employs in any
undertaking, or which he contributes to the
capital of a partnership, corporation, or any
other judicial entity or association in a
particular taxing jurisdiction.
proceeds not shared
exemptions: receipts from printing and/or
publishing of books and reading materials
prescribed by DECS as text and references

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Franchise Tax
Franchise
Right or privilege, affected with public interest
conferred upon private person or corporation,
under government- imposed terms and conditions
in interest of public welfare, security and safety
Tax rate: not to exceed
Tax Base
Provinces
Cities
Gross receipts
50% of 1%
75% of 1%
Capital investment
For start- ups

1/20 of 1%

3/40 of 1%

Franchise Tax
proceed not shared
exemption: holders of
certificates of public
convenience for
operation of public utility
vehicle

16

BLGF Opinion dated 06

February 2003
The province should impose
the tax on business enjoying a
franchise within its territorial
jurisdiction, excluding the
territorial limits of any city
located therein.

FRANCHISE TAX
Meralco, Globe, Smart,
Manila Water Maynilad
and PLDT are subject
to franchise tax on the
receipts derived within
the LGU

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Tax on sand, gravel and other

quarry resources
Tax subject: extraction of ordinary
stones, sand, gravel, earth. Etc. from
public lands or beds of public waters
within LGU
Tax rate: not to exceed
Tax Base
Fair market value
Of extract at site

Provinces

Cities

10%

15%

Tax on sand, gravel and other

quarry resources
proceeds shared (Sec. 10 of P.D. No. 426):
Provinces
province
component city/municipality
barangay
Cities
highly urbanized city
barangay

30%
30%
40%
60%
40%

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Tax on Professionals
Tax subject: persons engaged in the practice of
profession requiring government exams
Tax rate:
Provinces- maximum of Php 300/ profession
Cities- maximum of Php 300/ profession
Payment: on or before January 31 in the
province/city where practice is done, or principal
office is located
proceeds not shared
exemption: practice of profession exclusively as
government employee

BLGF Opinion dated 29

April 2003
The municipality is authorized to
impose reasonable fees and
charges on professionals which
do not require govt. examination
in the exercise of their
profession. The imposition,
however, shall be denominated
as fee not tax.

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Amusement Tax
Tax subject: patrons of shows and
entertainment activities; collected
and remitted by proprietors, lessees
and operators
Tax rate:
Provinces-not to exceed 30% of
paid admission fees.
Cities- not to exceed 30% of paid
admission fees
no admission fee, no tax

Amusement Tax
proceeds shared: 50-50 between
province and municipality
exemptions: operas, concerts,
dramas, recitals, painting and art
exhibition, flower shows, musical
and literary presentations except
rock and similar concerts

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Annual fixed tax on delivery

trucks and vans
Tax subject: trucks, vans or any motor
vehicle used by manufacturers, producers,
wholesalers, dealers or retailers within LGU
territory
Tax rate: maximum of
Province - Php 500/vehicle
City - Php 750/vehicle
collected with other business taxes
. proceeds not shared
potential source of avoiding payment of
other business taxes, when vehicle used as
sales outlet

Computation of
Business-related Taxes
Exclusions to gross
sales/receipts
1. Discounts, at the time of
sales, if determinable
2. Sales return
3. Excise tax
4. Value-added tax

21

Computation of Businessrelated Taxes

Three-step process
Step 1. Classify the business
Step 2. Determine gross receipts
Step 3. Determine tax due
- locate tax due on tax
schedule then compute
Tax due= tax base x tax rate +/penalty/discount

BLGF Opinion dated 05

August 2002
Where Pepsi-Cola Products Phils. Inc.
(PCPPI) maintains sales offices and
warehouse in certain municipalities or
cities for purposes of selling to
retailers, wholesalers and distributors
the softdrinks products it
manufacture, such municipalities or
cities should classify PCPPI for
business tax purposes as a
manufacturer, not as
a wholesaler,
distributor, dealer, or contractor.

22

BLGF Opinion dated 26

September 2002
The tax on contractors is NOT
imposed on the project
itself but on the business of
constructing the project,
irrespective of whether those are
exempt from the real
property taxes.

BLGF Opinion dated 27

November 2002
Bistro Americano (Q.C.)
Corporation as restaurant
operators and caterers shall
be subject to the business
tax pursuant to Section 143(h)
of the LGC (others).

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Sec. 193. Withdrawal of Tax

Exemption Privileges

Unless otherwise provided in this Code, tax

exemptions or incentives granted to, or presently
enjoyed by all persons, whether natural or judicial,
including government- owned or controlled
corporations are hereby withdrawn upon the
effectivity of this Code except:
1. Local water districts
2. Cooperatives registered under R.A. No. 6938
3. Non
- stock non
- profit hospitals and educational
institutions
4. Business enterprises certified by BOI as pioneer
or non
- pioneer
5. Business entity, association or cooperatives
registered under R.A. No. 6810
6. Printer and/or publisher of books and other
reading materials prescribed by DECS

24

Administrative Procedures
Requirements for Existing
Business
Mayors Permit must be
renewed within January 1-20
of every year
Renewal of existing business
permit is not automatic

25

Sec. 191. Authority of Local

Government Units to adjust
Rates of Taxes.
Local government shall have the
authority to adjust the tax rates
as prescribed herein not oftener
than once every five (5) years, but
in no case shall such adjustment
exceed ten (10) percent of the
rates fixed under this code.

Sec. 196 Claim for

Refund of Tax Credit
-

No case or proceeding shall be maintained

in any court for the recovery of any tax, fee,
or charge erroneously or illegally collected
until a written claim for refund or credit has
been filed with the local treasurer. No case
or proceeding shall be entertained in any
court after the expiration of two(2) years
from the date of the payment of such tax,
fee, or charge, or from the date the
taxpayer is entitled to a refund or credit.

26

ART. 242 - RELATED OR

COMBINED BUSINESS
(a) The conduct or operation of
two or more related
businesses provided in Article
232 of this Rule by any one
person, natural or juridical,
shall require the issuance of a
separate permit or license to
each business

(b) If a person conducts or

operates two (2) or more
related businesses which
are subject to the same
rate of imposition, the tax
shall be computed on the
basis of the combined total
gross sales or receipts of
the said two (2) or more
related businesses.

27

(c) If, however, the businesses

operated by one person are
governed by separate tax
schedules or the rates of the
taxes are different, the
taxable gross sales or receipts
of each business shall be
reported independently and
the tax thereon shall be
computed on the basis of the
appropriate schedule.

SITUS OF THE TAX

Taxable 100% where the sale is made or

effected 30% of all sales recorded in the
principal

office shall be taxable by the city or

municipality where the principal office is
located.

70% of all sales recorded in the principal

office shall be taxable by the city or
municipality where the factory, project
office, plant or plantation is located.

In cases where 2 or more factories, project

offices, plants or plantation located in
different localities, the 70% sales allocation
shall be prorated among the localities.

28

Assessment
Assessment is the inherent function
of the local treasurer.
Securing/applying business permit is
under the Office of the City Mayor.
EDP for Billing functions.
Acceptance of payment is again a
function of the Treasurers Office.

Community Tax
Should be paid in the place of
residence of the individual or
in the place where the
principal office of the
juridical entity is located.
Branches are not required to
secure community tax.

29

Manufacturers
Manufacturers sales office
which distributes its product
should also be classified as
manufacturers and taxable as
such and not as
distributor/wholesaler/retailer.

Retailer
Car dealers should not be
classified as wholesalers/dealers
simply because they are
commonly known as car dealers.
They should be classified as
retailers since they sell directly
to end-user or customers.

30

Real Estate Dealers

Real Estate
dealers/developers/lessors are subject
to the 70-30 allocation of sales.
Principal office 30% of gross sales.
Project office or location of the real
estate is subject to 70% of gross
sales.

Non Profit, Non Stock

Corporation
Only hospitals and educational institutions
are exempt from paying business tax.
Income derived from non-members who use
or rent the facilities are subject to business
taxes.
Required to pay regulatory fees and
charges.

31

Retirement of Business
Should be retired on or before the
20th day of January.
Should pay for the entire year
after January 20.
Sales realized from January up to
the time of retirement should
likewise be paid.

Security Agency
Security agency are subject
to business tax as
contractor and subject to
situs of tax at 70% - 30%

32

Educational Institutions

Canteens and bookstore

operated by the school are
exempted from the payment of
business tax.
Concessionaires operating
canteen and bookstores are
subject to business taxes.

Contractors

Contractors doing business in an

LGU are subject to business tax at
70%.
Main or Principal office are subject
to 30%.
Sub-contractors are not subject to
contractors tax. Only main
contractors are liable to pay the tax.
Tantamount to double taxation if
collected from sub-contractors.
Income derived from abroad are not
taxable.

33

Examination of
Books of Accounts
Function of the Provincial, City,
Municipal or Barangay Treasurer or
their duly authorized representatives.
Books of Accounts and records of
business establishments could only be
examined for a maximum period of 5
years.

Liquefied Petroleum
Products
LPG is not subject to local
tax. However, said LPG
business shall still be liable
to pay the Mayors permit
and other regulatory fees or
service charges.

34

RE-EXPORTATION
Re-exportation of finished
product should not be
classified as exporter or
local/domestic sale but
should be classified as
rendering service contractor

FRANCHISE TAX ON ELECTRIC

COOPERATIVE
BLGF Ruling Dated May 12, 2006

Electric cooperative shall be subject to

or liable to the payment of franchise
tax imposed by the province or city.
Base on the Ordinance approved by
the province or city.
Before the EPIRA Law (1997-2001)
Gross receipts less:
NPC Basic Power Cost
Allowance for system loss
Reinvestment fund
Amortization Cost

35

Upon the effectivity of the

EPIRA Law (2002)
Gross receipts less:
NPC Charges
TransCo charges
Reinvestment fund
Universal Charges

Remedies for Collection

of Taxes
Civil Remedies
Administrative Remedies thru
distraint of goods or other personal
properties.
Closure of business establishments
by the office of the mayor.
Judicial Action
Filing of Tax evasion case

36

VICTOR B. ENDRIGA, Ph.D.

Quezon City Treasurer

QUEZON CITY
Former Capital of the Philippines
Largest City in Metro Manila in terms
of population and land area with 2.17
Million residents occupying over
16,000 hectares of land area
Was known as the most financially
distressed Local Government Unit in
Metro Manila and probably nationwide
in 2001

37

THE FINANCIAL RECOVERY OF QUEZON

CITY
Cash Balance in the General Fund of Quezon
City was negative P10.35 million when Mayor
Belmonte assumed office on July 1, 2001
Inherited claims for payment amounting to P1.4
billion, including GSIS, Phil Health, BIR,
Meralco etc.
Bank Loan of P1.25 billion left by previous
administration with the Land Bank of the
Philippines

1.

Auction Sale of
real property
instead of Tax
Amnesty every
quarter.

38

PERIOD OF DELINQUENCY TO BE
INCLUDED IN THE AUCTION SALE

1. For residential 5 years

2. For commercial and industrial
3 years
3. For machineries 3 years
This is an internal rule
promulgated by the auction
committee

2.) Reassignment of
permanent employees to
avoid familiarization with
Taxpayer.
3.) Prepared at least 20
delinquency letters per day
per employee assigned in the
Real Estate Division.
4.) Computerization of
systems and processes.

39

5.) Issued new Official Receipts

with security features to
identify and curb the
proliferation of fake receipts.
6.) Constructed the taxpayers
assessment and payment
lounges (free Coffee & Ice
Tea).
7.) Recognized the 10
outstanding Taxpayers for
Business and Real Property.

8.) Increased the discount given to Real

Property Taxpayers paying annually from
10% to 20%, and from 5% to 10% for
those paying promptly quarterly.
9.) Conducted Auction Sale of Government
Owned and Controlled Corp. such as
Heart Center, Lung Center, Kidney
Center and MWSS.
10.) Hired an independent and private
encoding company to encode all RPT
payment records and Tax Declarations.
11.) Automatically Generated and issued
Computerized Delinquency Letters
amounting to P10.7 Billion Pesos.

40

12.) Filed anti-graft cases with the office of

the Ombudsman against employees issuing
fake RPT Receipts, that resulted to the
dismissal of 6 employees.
13.) Declared Tax Amnesty on Machinery and
Equipment from Oct. to Dec. 2002.
14.) Created a special Task Force on
Machinery composed of representatives
from the Treasury, Assessors and
Engineering Departments to conduct
physical inventories of all machinery and
equipment which failed to avail of the Tax
Amnesty.

15.) Posted 300 Billboards in

major thoroughfares informing the
date of the Auction Sale and the
increased discount from 10% to
20%, if RP Tax is paid annually.
16.) Allowed staggered payment of
Delinquent Real Property Taxes
upon payment of a minimum of
30% down and the balance
payable within 6 months.

41

17.) Verified the total value of

machinery as appearing in the Tax
Declaration issued by the
Assessors Office and counter
checked this ,with that appearing
in the financial statements.
18.) Instruct the Building Official to
forward to the City Assessor the
building / occupancy permit,
stating the total value of the
construction cost, for issuance of
a new tax declaration.

19.) Instruct the City Engineer to

forward to the City Assessor all
application for mechanical
permit for issuance of a new tax
declaration on machineries.
20.) Implemented the Geographic
Information System (GIS) for
future tax mapping of Real
Property.

42

Parcels with No Tax

Declaration Record

43

Undeclared Buildings Map

44

Misclassification of
Land Use

All Tax Payments records

Analysis
By pointing and clicking
to a parcel, payment
history can be displayed
and delinquent tax payers
can be easily identified.

45

1.) Required taxpayers with gross

receipts of over P500,000.00 to
submit BIR stamped 2005
financial statements and
records of monthly payments
of VAT and NON-VAT for the
year 2006; for comparison
against declared gross
receipts for 2006 before
renewing their Mayors Permit
for 2007.

2.) Utilized the

presumptive income
level approach
(implementing a
schedule of minimum
gross) to make gross
tax declarations more
realistic and current.

46

3.) Alignment of Business

Taxes with Metro Manila
Rates
4.) Consultation and
Dialogue with the
Business Sector
particularly QCCCI

5.) SEC / BIR gross-sales data versus

declared gross sales with LGUs.
6.) Census and listing of tax payers.
7.) Adequate and competent staffing.
8.) Examinations of books of account
and pertinent records by the Treasurer
or his authorize representative.
9.) Revenue target setting

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10.) Required
contractors to pay
business tax prior to
the release of the
building, excavation
and occupancy
permits.

11.) Required dealers, sellers,

and developers of real
estate, such as land,
building, condominium units
and the like, especially
corporations and other
juridical entities, to present
their Mayors Permit and
proof of payment of Business
Taxes before processing the
Transfer Tax.

48

12.) Instructed the City

Accountant to deduct
from the voucher the
amount owing to the
payment of Business
Tax for contractors and
suppliers doing
business with the City.

13.) Instructed the BPLO to

conduct a door to door, street by
street, inspection and verification
of all unlicensed establishments.
14.) Identified establishments
having decreased current
declared gross receipts compared
to previous years and examined
their Books of Accounts for
verification of actual sales.

49

15.) Used (ink) color

coding in signing the
tax bills and stamp
pad with my picture
on it, and other
official documents
during renewal period.

16.) Employed the

raffle system in
the assignment of
Letters of Authority
to revenue
examiners.

50

17.) Grounded a number of

revenue examiners with
low collection outputs
every month.
18.) Rewarded top collector
revenue examiner with a
free trip to Hong Kong and
other incentives.

19.) Created a special team to

compare Treasury records of
Transfer Tax payments with
those found in the Land
Registration Authority.
(Transfer Tax Records in 2001
revealed that 58% of those
recorded in the LRA were fake
receipts and only 42% were
valid and legitimate.)

51

20.) Maintained a
photo gallery of all
permanent and casual
employees with
corresponding
assignments, for
easier identification.

21.) Required
advertising agency
to pay contractors
tax prior to the
release of the
billboard permit.

52

22.) Update local business

tax ordinances by 10%
once every 5 years.
23.) Adjust existing fees
and charges.
24.) Require payment of
community tax on all
transaction with LGUs.

QUEZON CITY IS THE RICHEST

CITY NOT ONLY IN METRO
MANILA BUT IN THE ENTIRE
COUNTRY AS WELL, AS
AUTHENTICATED BY THE
COMMISSION ON AUDIT,
BEATING MAKATI AND MANILA
IN TERMS OF REVENUE
COLLECTION FOR THE YEAR
2002,2003,2004 AND 2005

53

FMV along EDSA

Caloocan
Quezon City
Mandaluyong
Makati
Pasay

P55,000
P 5,500
P12,000
P48,000
P25,000

The highest FMV in Quezon City is only

P5,500

Report Collection for CY 2002

2001-2002
Nature of Collection
2001
2002
Real Estate

722,437,380

847.964,965

17.38

1,209,965,603

2,467,209,132

103.91

Fees and Charges

149,224,960

231,964,478

93.51

Transfer Tax

107,510,561

200,013,469

86.04

Amusement Tax

Business Taxes

146,400,840

131,480,835

-10.19

LOCAL SOURCES

2,335,539,344

3,878,632,879

66.07

BIR Allotment

1,300,485,734

1,290,701,951

-0.75

MMDA Contribution

97,716,000

126,564,000

29.52

Other Income

47,929,204

106,091,335

121.35

3,781,670,287

5,401,990,168

42.85

330,991,390.01

364,308,924

10.07

626,228,233

721,696,806

15.25

39,564,876

65,517,016

65.59

4,778,454,787

6,553,512,915

37.15

GENERAL FUND
Barangay Share RPT
SEF
Other Trusts
GROSS COLLECTION

54

Report of Collection for CY 2005

as of January to December 31, 2006
2005

2006

Increase
(decrease)

Real Estate

1,017,808,956

1,337,428,919

319,619,963

Business Taxes

2,633,377,989

2,899,388,991

266,011,001

10.01

Other Regulatory/Misc Fees

265,051,332

352,074,538

87,023,205

32.83

Transfer Tax

237,212,000

235,725,565

(1,486,434)

(0.63)

Amusement Tax

143,141,648

131,262,836

(11,878,812)

(8.30)

Community Tax

59,941,629

66,833,390

6,891,761

218,481,333

526,562,216

308,080,882

Other Income

31.40

11.50
141.01

SUBTOTAL

4,575,014,890

5,549,276,458

974,261,568

21.30

IRA

1,325,076,782

1,295,641,743

(29,435,039)

(2.22)
19.09

IRA Contribution to MMDA

213,845,000

252,528,000

38,683,000

6,113,936,804

7,097,446,201

983,509,529

16.09

Special Education Fund

826,935,804

1,038,674,677

211,738,872

25.61

Bgy. Share

437,656,191

550,756,457

113,100,266

25.84

7,378,528,668

8,686,877,336

1,308,348,668

17.73

81,957,537

143,021,796

61,064,258

74.51

7,460,486,205

8,829,899,133

1,369,412,927

18.36

GENERAL FUND

Total City Collection

Other Trusts
GROSS COLLECTION

GENERAL FUND
as of December 31, 2006
BUDGET

6,250,000,000

ACTUAL

7,097,446,201

SURPLUS

847,446,201

55

Top 10 in terms of highest total income generated

for CY 2004 as compared to 2001
(NCR)
CLASS
RANK
RANK
2004
2001
CITY

QUEZON CITY

1ST

MAKATI
MANILA
PASIG

6,496,282,210

3RD

4,276,721,410

2ND

6,247,252,757

1ST

5,122,321,279

3RD

6,029,451,082

2ND

4,422,171,694
2,220,682,718

4TH

2,969,849,218

4TH

KALOOKAN

5TH

1,681,228,300

6TH

1,493,125,921

MANDALUYONG

6TH

1,601,355,056

7TH

1,165,955,784

PARANAQUE

7TH

1,590,065,300

5TH

1,533,439,002

MUNTINLUPA

8TH

1,250,547,925

8TH

1,087,802,228

9TH

1,246,598,000

9TH

1,075,895,000

10TH

1,1,73,179,686

10TH

872,868,370

SAN JUAN

1ST

519,580,000

2ND

430,370,000

NAVOTAS

2ND

276,671,818

3RD

292,835,782

PATEROS

3RD

72,952,324

4TH

62,188,114

PASAY
VALENZUELA
MUNICIPALITY

GEN. FUND

S.E.F.

TRUST
FUND

TOTALS

83,216,459

107,266,365

154,191,123

345,001,948

Time Deposits

1,423,966,330

431,777,055

431,925,255

2,287,668,641

Cash on Hand &

in Bank

1,512,560,010

539,043,420

586,444,378

2,638,047,810

FUNDS
Funds
Available
Today

56

FINANCIAL PERFORMANCE OF LOCAL GOVERNMENT UNITS

COA REPORT / National Capital Region CY 2002
Internal Sources
3,946,465.3

External Sources
1,339,568.0

Grand Total
5,286,033.3

3,816,458.7

403,992.6

4,220,451.3

3. Manila City

3,116,507.8

1,047,027.1

4,163,534.9

4. Pasig City

1,677,114.8

388,438.6

2,065,553.3

5. Caloocan City

640,142.2

740,218.3

1,380,360.5

6. Mandaluyong City

778,135.5

280,363.8

1,058,499.3

7.) Paranaque City

708,046.2

345,447.7

1,053,493.8

8. Pasay City

639,536.0

306,163.3

945,699.3

9. La Pinas City

467,153.0

373,755.2

840,908.2

10. Muntinlupa City

533.984.0

304,334.4

838,318.3

11. Valenzuela City

434,465.2

375,762.2

810,227.3

12. Marikina City

382,179.0

318,950.7

701,129.7

13. Taguig

337,956.7

226,678.0

564,634.7

14. Malabon City

139,776.2

289,257.2

429,033.4

15. San Juan

314,598.4

66,611.7

381,210.9

16. Navotas

91,122.0

116,296.9

207,418.9

17. Pateros

23,734.1

37877.1

61,611.2

Cities/Municipalities
1. Quezon City
2. Makati

2004 INCOME STATEMENT

GENERAL FUND
INCOME
Tax revenues

QUEZON CITY

MANILA

MAKATI

3,932,060,660

3,017,485,962

3,422,250,392

897,657,280

608,287,258

1,405,161,315

2,753,350,830

2,234,148,853

1,826,109,950

281,052,550

175,049,851

190,379,126

Non-Tax Revenues

390,022,310

593,099,926

337,607,540

Regulatory fees

Real property tax

Business tax
Other tax

213,071,460

178,841,429

214,303,596

Service/User charges

53,899,860

161,887,878

45,243,634

Economic Enterprise

20,302,230

154,474,482

37,601,206

102,748,770

96,871,990

40,459,102

Shares from national tax

collection/Grants/Aids

1,472,766,930

1,100,610,001

629,435,809

Loans and borrowings

-------

Inter-Local Transfers

-------

Other receipts

TOTAL INCOME

5,794,829,900

-------830,345,778

5,541,541,667

108,866,054
-------

4,489,159,795

57

STATEMENT OF INCOME AND EXPENDITURES

CY
- 2005
INCOME

EXPENDITURES

EXCESS/DEFICIT

1.Quezon City

7,376,391,780.00

4,769,022,210.00

2,580,389,570.00

2.Manila City

7,119,823,858.00

5,902,084,336.00

1,217,739,522.00

3.Makati City

6,320,342,864.75

4,416,865,605.91

1,903,477,258.84

4.Pasig City

2,969,849,218.46

2,897,677,927.86

72,171,290.60

5.Paraaque City

1,997,001,967.15

1,892,401,933.02

104,599,764.13

6.Kalookan City

1,681,228,300.25

1,456,825,963.54

224,402,336.71

7.Mandaluyong City

1,601,355,056.00

1,422,370,155.00

178,984,901.00

8.Muntinlupa City

1,364,082,104.90

1,329,592,287.06

34,489,817.84

9.Valenzuela City

1,173,179,685.75

942,242,676.82

230,937,008.93

10.Marikina City

1,123,019,340.00

778,312,420.00

344,706,920.00

11.Las Pias City

1,098,864,570.00

1,011,286,870.00

87,577,700.00

12.Taguig

831,014,000.00

812,357,000.00

18,657,000.00

13.Malabon City

570,243,044.42

463,194,670.88

107,048,373.54

14.San Juan

519,580,000.00

459,200,000.00

60,380,000.00

15.Navotas

276,671,818.05

253,653,320.10

23,018,497.95

16.Pateros

83,297,713.42

79,738,124.59

3,559,588.83

37,352,537,051.15

29,852,591,500.78

7,499,945,550.37

TOTAL

PARTICULARS

QUEZON CITY

MANILA

MAKATI

INCOME

7,376,391,780.00

7,119,823,858.00

6,320,342,864.75

LOCAL SOURCES

5,828,214,960.00

5,103,606,479.00

5,810,054,849.16

TAX REVENUE

5,240,530,690.00

4,438,344,332.00

5,264,943,985.16

Real Property

2,299,519,760.00

1,889,166,686.00

2,462,986,843.28

Business Taxes

2,635,229,130.00

2,351,070,156.00

2,513,988,823.49

305,781,800.00

198,107,490.00

287,968,318.39

NON-TAXES REVENUE

587,684,270.00

665,262,147.00

545,110,864.00

Regulatory Fees

304,124,060.00

269,796,183.00

187,575,606.84

Service/User Chrages

122,166,900.00

166,311,490.00

66,601,993.32

30,658,620.00

185,458,341.00

105,744,778.21

Other Taxes

Receipts from Eco. Ent.

Toll Fees
Other Receipts
SHARES FROM NATIONAL TAX
COLLECTIONS

0.00

9,913.00

0.00

130,734,690.00

43,686,220.00

185,188,485.63

1,548,176,820.00

1,156,140,434.00

431,979,800.00

EXTRAORDINARY
RECEIPTS/GRANTS/AIDS

0.00

500,000.00

26,608,118.85

LOANS AND BORROWINGS

0.00

0.00

51,700,096.74

INTER-LOCAL TRANSFER

0.00

859,576,945.00

0.00

58

5,820,000,000.00

5,707,509,556

5,600,000,000.00

5,304,608,683

5,200,000,000.00

5,286,033,298

4,700,000,000.00

3,641,861,948

4,072,000,000.00

2,000,000,000

3,286,396,701

3,000,000,000

3,870,000,000.00

4,000,000,000

3,788,687,846

5,000,000,000

5,175,000,000.00

6,000,000,000

6,122,034,764.55

1999-2005 Estimate VS. Actual Comparative

1,000,000,000

Estimate

Actual

1999

2000

2001

2002

2003

2004

2005

Report of Collection as of Feb. 27, 2007

2006
Real Estate
Business Taxes
Other Reg./Misc Fees

2007

Increase (decrease)

% surf (def)

274,682,517

284,534,710

9,852,192

1,201,456,187

1,279,649,917

78,193,729

6.51

61,844,723

152,218,191

90,473,467

146.29

Transfer Tax

31,631,495

39,779,550

8,148,054

Amusement Tax

22,340,412

13,099,296

(9,241,116)

3.59

25.76
(41.37)

Community Tax

45,190,061

53,389,517

8,199,456

18.14

Other Income

42,060,602

102,179,426

60,118,823

142.93

8,572,061

23,980,793

15,480,732

179.76

1,687,778,062

1,948,931,403

261,153,341

15.47

IRA

88,485,716

133,847,738

45,362,022

51.26

IRA Contribution to MMDA

18,407,000

21,923,000

3,516,000

19.10

Special Accounts
SUBTOTAL

1,794,670,778

2,104,702,141

310,031,363

17.28

Special Education Fund

230,823,737

239,292,657

8,468,920

3.67

Barangay Share

116,380,658

121,933,264

5,552,605

4.77

2,141,875,175

2,465,928,063

324,052,888

15.13

16,319,502

31,341,864

15,022,361

92.05

2 158 194 678

2 497 269 928

339 075 250

15 71

GENERAL FUND

TOTAL City collection

Other Trusts
GROSS COLLECTION

59

Cash Report
as of Feb. 27, 2007
FUNDS

GEN. FUND

S.E.F.

TRUST
FUND

TOTALS

Funds
Available
Today

432,716,682

174,710,097

446,251,976

1,053,678,955

Time
Deposits

5,086,775,946

230,654,885

184,794,997

5,502,225,829

Cash on
Hand & in
Bank

5,539,826,738

405,364,982

631,046,973

6,576,238,694

60

OTHER TREASURY
FUNCTIONS:
1.GASOLINE CALIBRATION
2.INSPECTION OF WEIGHTS
AND MEASURES
3.BILLBOARDS

GASOLINE CALIBRATION
Increase penalty of defective gasoline
pumps:
1. 1st Offense - from P200 to P4,000
2. 2nd Offense - from P500 to P5,000
3. 3rd Offense - cancellation/revocation
of mayor permit to operate a business
* Calibration of gas pump from annually to
quarterly.
Note: The court may impose 3 months to 1
year imprisonment or both fine and
imprisonment at the discretion of court

61

CALIBRATING BUCKET

62

TEST WEIGHTS

63

Ordinance 1508, S-2005

An Ordinance authorizing the
city treasurer to accept as an
alternative mode of payment
for taxes and fees from
taxpayers through the use of
over the counter payments in
accredited banks, internet
banking and automated teller
machines.

64

ACCREDITED BANKS
REPRESENTED BY
1. LANDBANK OF THE PHILIPPINES
MS. GILDA E. PICO Pres.& CEO
2. DEVELOPMENT BANK OF THE PHILS.
- MR. REYNALDO DAVID Pres. & CEO
3. PHILIPPINE NATIONAL BANK
- MR. OMAR BRYON T. MIER Pres.& CEO
4. PHILIPPINE VETERANS BANK
- MR. RICARDO A. BALBIDO, JR. Pres.& CEO
5. UNION BANK OF THE PHILS.
- MR. EDWIN R. BAUTISTA Exec. Vice-Pres.
6. PHILIPPINE POSTAL SAVINGS BANK
- MR. ROLANDO L. MACASAET Pres. & CEO

ORDINANCE NO. 1663,

S-2006
An Ordinance authorizing the
city Mayor to require the city
treasurer or his duly authorized
representatives to apprehend
persons, corporations and
entities doing business in
Quezon City not issuing
receipts and/or sales invoice.

65

66

VICTOR B. ENDRIGA, Ph.D.

Cel. NO. 0920-9555444
Tel. No. (02) 928-8336

67

68