The Valuation Reform Act (“VRA”), as proposed under Senate Bill No and House Bill No.8453, aims to introduce vital reforms to promote the development of a just, equitable, and efficient real property valuation system. The reforms will broaden the tax base used for property and propertyrelated taxes of the national and local governments, thereby increasing government revenues without increasing the existing tax rates or devising new tax impositions.
VRA aims to address the following systemic problems: a. rampant outdated valuations used for governmental purposes, especially for national and local taxation; b. cost overruns and foregone revenues due to low valuations used: overvaluation when government pays, undervaluation when government collects; c. valuation as a political issue; d. multiple, overlapping valuations in different government agencies, and there is no single agency responsible for ensuring that valuations are completed in accordance with international standards; and e. absence of a comprehensive real property electronic database.
By improving the quality of valuation of local governments and making the revisions frequent, efficient, transparent, reliable and attuned to market developments, VRA impacts favorably on revenue generation and resource mobilization of local governments to fund their service delivery requirement. The reforms are also expected to foster private investors’ confidence, and build the public’s trust in the valuations of government.