Section 251 of the Local Government Code provides for tax discount for advanced prompt payment. The provision states that, “If the basic real property tax and the additional tax accruing to the Special Education Fund (SEF) are paid in advance in accordance with the prescribed schedule of payment as provided under Section 250, the sanggunian concerned may grant a discount not exceeding twenty percent (20%) of the annual tax due.”
Section 250 of the Code provides that, “The owner of thereal propertyor the person having legal interest therein may pay the basic real property tax and the additional tax for Special Education Fund (SEF) due thereon without interest in four (4) equal installments; the first installment to be due and payable on or before March Thirty-first (31st); the second installment, on or before June Thirty (30); the third installment, on or before September Thirty (30); and the last installment on or before December Thirty-first (31st), except the special levy the payment of which shall be governed by ordinance of the sanggunian concerned. The date for the payment of any other tax imposed under this Title without interest shall be prescribed by the sanggunian concerned. Payments of real property taxes shall first be applied to prior years delinquencies, interests, and penalties, if any, and only after said delinquencies are settled may tax payments be credited for the current period.”
Thus, it is up to the local government unit as to how many percent discount shall be given to reward early taxpayers, provided that it is within the bounds stated by law. The tax discounts are given by local government units to encourage their constituents to not be late with their payments.
Keep in mind, however, that it is only taxpayers who did not incur any delinquencies who are qualified to avail of the tax discounts.
An example of a local government unit who issued a notice for discounted real property taxes for 2023 is the City of Taguig. The City of Taguig offered a 20% discount for those who will pay early. Rates will depend on the cut off date set by the city hall. For example, it can be 20% if paid on or before November 30th or 10% on or before December 29th.
Another example is the local government unit of the City of Alaminos, Pangasinan. They stated in their Notice of Payment for Real Property Tax In Alaminos City for the Calendar Year 2023 that “taxpayers with no delinquency who shall pay their real property tax in full for the year 2023 on or before December 31, 2022 are entitled to a twenty percent (20%) discount and those who opt to pay on the first quarter (January 2, 2023- March 31, 2023) are entitled to a fifteen percent (15%) discount.”
On the other hand, Taxpayers of Quezon City, are entitled to a 20% discount for annual payment of real property taxes paid on January 31 or before March 31. A 10% discount will be given to those who will pay promptly on or before the quarterly dates mentioned by law for installment payments.
Need further information and assistance regarding discounts on real property tax in the Philippines? Talk to our team at FILEDOCSPHIL to know more about the requirements and process. Call us today at (+632) 8478 5826 or send an email to [email protected] for more information.