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TRJ 2005 Vol XVII No 2: Implications of Section 270 of the Local Government Code Re: Periods Within Which to Collect Real Property Taxes

The study looks into the implication of the prescription period in the collection of the real property tax (RPT) as provided under Section 270 of the Local Government Code (LGC). It has been noted that the provision on the prescriptive period under Section 270 has never been operational in most local government units (LGUs). Some local treasurers who have adopted the said section usually have different interpretations. The Bureau of Local Government Finance (BLGF) clarifies that the five-year prescriptive period is only provided to enforce the collection of RPT within a specific span of time. Hence, local treasurers cannot execute administrative or judicial remedies after the lapse of the five-year prescriptive period but it does not mean that local treasurers can no longer collect delinquent taxes accruing for the period. The Implementing Rules and Regulations (IRR) of the LGC failed to provide for the guidelines on the application of Section 270. It reiterates what is stipulated under the Code. In this regard, it is recommended that the DOJ be consulted about the proper interpretation of Section 270 to enlighten the taxpayers about its application. Thereafter, the BLGF can issue its implementing guidelines in order to enforce Section 270 and its related provisions effectively. Without this initiative, LGUs will continue to be confused, thereby affecting their RPT collection. Said guidelines should include the duties and responsibilities of local treasurers as well as the sanctions/penalties for failure to perform the same. The firm support of the local chief executives is also necessary to encourage the local treasurers to pursue collection by all means. Based on the foregoing, the strict implementation of Section 270 of the LGC and its related provisions particularly the sanctions for failure to institute administrative and judicial remedies under Section 259 is imperative. Tax delinquencies which are not collected within the five-year period should be automatically written off to compel local treasurers to collect the RPT promptly. This would strengthen the prescriptive period's objective of raising significant amount of revenues from RPT thereby eventually eradicating tax delinquencies.

National Tax Research Center
Authors Keywords
National Tax Research Center; real property tax; local government code;
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