The Department of Finance (DOF) has retained the thresholds on housing units exempt from value-added tax (VAT), according to the Organization of Socialized and Economic Housing Developers of the Philippines (OSHDP)
OSHDP said the Bureau of Internal Revenue (BIR) recently issued Revenue Regulation (RR) No. 8-2021 amending certain provisions of RR No. 4-2021 which implemented the VAT provisions under Republic Act (RA) No. 11534 or the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE).
The regulation effectively retained VAT-exempt thresholds of P1,919,500 for residential lot and P3,199,200 for house and lot.
Citing the adverse effect of the pandemic and urgent need to address the plight of the poor and low-income Filipinos, OSHDP, jointly with the National Real Estate Association, earlier wrote Finance Secretary Carlos Dominguez and clamored for the suspension of the implementation of the reduced VAT-exempt threshold under the Tax Reform for Acceleration and Inclusion Law, or to implement the same in a manner least prejudicial to the most adversely impacted segment of the society.
VAT exemption for housing was set to go down from P3.199 million to P2 million effective January 2021.
OSHDP said the BIR’s move will give relief to pandemic-affected poor and low-income workers and will help the get access to decent and affordable homes.
