July 20, 2000
DAR OPINION NO. 15-00
Ms. Elizabeth A. Fernando
Head, Acquired Assets Management Unit
GFSME
7/F, One Corporate Plaza
845 A. Arnaiz Ave., 1223 Makati City
Dear Miss Fernando:
This has reference to your letter dated 26 May 2000, requesting for clarification on what is the reckoning date for the payment of real estate taxes.
You stated that the two (2) parcels of agricultural land owned by Guarantee Fund for Small and Medium Enterprises (GFSME) and the closed Peninsula Development Bank, which were acquired under the Comprehensive Agrarian Reform Program (CARP) in 1993 and Certificates of Land Ownership Award (CLOAs) distributed in that same year, were assessed of tax arrearages up to 1999 by the Assistant City Assessor of Davao. Thus, your request for clarification.
Please be informed that GFSME may no longer be assessed of tax arrearages up to 1999 considering that ownership of said lands had already been transferred in the name of the Republic of the Philippines in 1993. From then on, GFSME was no longer the owner of subject properties. Section 66 of R.A. No. 6657 provides, quote:
Section 66. Exemptions from Taxes and Fees of Land Transfers. — Transactions under this Act involving a transfer of ownership, whether from natural or juridical persons, shall be exempted from taxes arising from capital gains. These transactions shall also be exempted from the payment of registration fees, and all other taxes and fees for the conveyance or transfer thereof: Provided, That all arrearages in real property taxes, without penalty or interest, shall be deductible from the compensation to which the owner may be entitled. (emphasis supplied)
Section 66 of R.A. No. 6657 speaks of arrearages in real property taxes to be deducted from the landowner's compensation. Once ownership has been parted with, it follows that there are no more arrearages in real estate taxes to be paid.
We hope to have clarified the matter with you.
Very truly yours,
(SGD.) FEDERICO A. POBLETE
Undersecretary for Legal Affairs, and Policy and Planning