Fire Code Fees, Taxes & the Collection of Fire Code Revenues

Why the money provisions are tested

Fire Safety and Prevention is 20% of the Fire Officer Examination, and inside it the revenue provisions of Republic Act No. 9514 are over-represented. They are precise, numerical and easy to write unambiguous items about, and a Fire Safety Inspector (FSI) assesses these impositions personally, so the Civil Service Commission treats them as job-relevant. Sections 12, 13, 13-A, 13-B and 13-C are short. Memorise them as printed.

Fire Code fees are not Fire Code taxes

Section 12(b)(1) imposes Fire Code fees — "fees to be charged for the issuance of certificates, permits and licenses as provided for in Section 7(a) hereof". Section 7(a) is the inspection requirement, so the fees attach to the regulatory acts a fire station actually performs:

• Fire Safety Evaluation Clearance (FSEC) — review of building plans and fire protection system design before construction.
• Fire Safety Inspection Certificate (FSIC) — for a use and occupancy permit, and for the issuance or renewal of a business permit or permit to operate.
• Permits to store, handle or use explosives and combustible, flammable, toxic and other hazardous materials — the LPG refilling plant in Valenzuela, the paint warehouse, the fireworks retailer in Bocaue.
• Permits and certificates covering installation of fire protection and fire safety equipment and electrical systems, and inspection of sprinkler, standpipe and fire alarm systems.

The statute fixes no peso schedule; the 2019 Revised Implementing Rules and Regulations (RIRR) pegs fees to what the local government already charges. The fire safety inspection fee is fifteen percent (15%) of all fees charged by the local government unit (LGU) or the Philippine Economic Zone Authority (PEZA), but in no case lower than PhP 500.00. The base moves with the LGU's business-permit schedule; the floor does not.

Section 13-A vests assessment of Fire Code taxes, fees and fines in the BFP, which prescribes the procedural rules subject to Department of the Interior and Local Government (DILG) approval. Section 13 vests collection in the BFP too: "All taxes, fees and fines provided in this Code, shall be collected by the BFP." Section 13-B leaves the LGU only those taxes and fees prescribed in the Local Government Code. Payment runs to the BFP, not to the city treasurer.

The five Fire Code taxes

Section 12(b)(2) to (6) imposes five taxes; the RIRR gives them working names. State each base exactly — the CSC builds distractors by swapping bases.

One textual quirk you must be able to state outright — Section 12(b)(3) is internally inconsistent as enrolled: the words read "One-hundredth of one per centum" — 0.01% — while the parenthetical numeral prints "(0.10%)". This is a drafting artifact carried verbatim from Section 13(b) of the repealed Presidential Decree No. 1185 into RA 9514 and then reproduced in the 2019 RIRR. BFP assessment practice follows the words: one-hundredth of one percent, or 0.0001. Compute from the words.

Where the money goes

RA 9514 does not create a "special account in the general fund", and neither did PD 1185 — that label is a common review-centre error. Section 12(b) says these taxes and fees "shall accrue to the General Fund of the National Government". Section 13 then splits every peso the BFP collects:

• Twenty percent (20%) is "set aside and retained for use by the city or municipal government concerned", which must appropriate it exclusively for the operation and maintenance of its local fire station, including the construction and repair of fire station.
• The remaining eighty percent (80%) is "remitted to the National Treasury under a trust fund assigned for the modernization of the BFP".

Republic Act No. 11589 (BFP Modernization Act of 2021) operationalises that 80%. Its Section 7 makes the BFP's 80% share of Fire Code taxes, fees and fines a source of the BFP Modernization Trust Fund, administered by the Chief, BFP, alongside programme appropriations, proceeds from disposal of excess assets, grants and interest income.

What the money may lawfully buy

Section 13-C authorises the Chief, BFP — subject to the approval of the Secretary of the Interior and Local Government (SILG) — to use Fire Code income for:

1. Procurement of fire protection, firefighting, investigation, rescue and paramedic supplies and materials;
2. Related technical services necessary for the fire service;
3. Improvement of the facilities of the BFP — stations, training facilities, communications;
4. Abatement of fire hazards, including summary abatement the government fronts;
5. Equipment sized to need — the BFP determines the optimal number of fire trucks and hydrants each LGU requires, and the Bureau of Product Standards of the Department of Trade and Industry certifies that supplies conform to BFP product standards.

Two limits examinees miss. The RA 11589 trust fund excludes salaries and allowances — it is a capability fund, not a payroll. And the LGU's 20% is earmarked for its own fire station; a mayor may not reprogram it into a covered court.

Worked assessment

A four-storey business process outsourcing (BPO) building in Cebu City, assessed value PhP 8,500,000.00, not a single family dwelling.

1. Liability confirmed — Section 12(b)(3) covers it; the dwelling exception does not apply.
2. Rate: one-hundredth of one percent = 0.0001.
3. PhP 8,500,000.00 x 0.0001 = PhP 850.00, payable annually upon payment of the real estate tax.
4. Section 13 split: 20% x 850 = PhP 170.00 retained by Cebu City for its fire station; 80% x 850 = PhP 680.00 remitted to the National Treasury.

Misplace the decimal and the damage is obvious: at 0.1% you would assess PhP 8,500.00 (ten times over), at 1% PhP 85,000.00 (a hundred times over). Now the construction tax — a warehouse with a verified estimated value of PhP 40,000,000.00: 0.1% = PhP 40,000.00, under the cap, so PhP 20,000.00 before the building permit and PhP 20,000.00 before the occupancy permit. At PhP 80,000,000.00 the arithmetic gives PhP 80,000.00, so the ceiling bites: assess PhP 50,000.00, paid PhP 25,000.00 and PhP 25,000.00.

Receipts, audit and your own exposure

Every collection requires an official receipt; BFP receipts are non-VAT. Remittance is auditable by the Commission on Audit (COA) under its constitutional mandate over all government funds, and Section 13-D required the Chief, BFP to install a mechanism monitoring enforcement including the amount of Fire Code fees collected.

No fire officer may waive, condone or discount a Fire Code imposition — the rates are statutory. Under-assessing to favour an establishment, or pocketing a collection, exposes you to administrative liability under Section 11(2)(a)(7) for "abusing his/her authority in the performance of his/her duty through acts of corruption and other unethical practices", punishable by reprimand, suspension or removal; criminal liability under Section 11(2)(b) — imprisonment of six months to six years and/or a fine up to PhP 100,000.00; malversation under Article 217 of the Revised Penal Code; RA 3019 (Anti-Graft and Corrupt Practices Act), especially Section 3(b) on receiving a benefit in connection with a transaction and Section 3(e) on giving unwarranted benefit through manifest partiality or evident bad faith; and RA 6713 (Code of Conduct and Ethical Standards for Public Officials and Employees). Endorsing a business permit without an FSIC is itself a listed administrative offence.

Traps

• Base swap. Assessed value is the realty tax; verified estimated value is the construction tax; gross sales is the sales tax. Do not mix them.
• Decimal drift. 0.01% (realty), 0.1% (construction) and 1% (nothing) are three different numbers.
• Wrong destination. Fees are not LGU general-fund income. The BFP collects, the impositions accrue to the National Government's General Fund, and only 20% flows back — earmarked.
• Waiver. The BFP may not exempt anyone; only Congress can.
• Insurance nuance. Re-insurance premiums are excluded from the 2% premium tax, yet insurance-adjustment service fees are taxed at 2%.
• Dwellings. Single family dwellings escape the annual realty tax only. They still owe the construction tax when built.