BIR Ruling No. 317-2016

BUREAU OF INTERNALREVENUE REPUBLICOF THE PHILIPPINES DEPARTMENT OP FINANCE

Quezon City

Section 20,RA 7279 BIR Ruling No.063-2014

#317-2016

NATIONAL HOUSING AUTHORITY 6-28-2016

Diliman. Quezon City Quezon Memorial Elliptical Road

Attention: Visayas Management Office Lorna M. Seraspe Group Manager

Gentlemen:

Construction, for a certificate of tax exemptionon the land development of Catbalogan Resettlement Project located at Brgy. Sta. Lagundi, Catbalogan City.pursuant to Republic Act (RA No. 7279, otherwise known as the Urban Development and Housing Act of 1992 This refers to your letter dated June 30, 2014 requesting, on behalf of Richmark

Government Units (RAP-LGUs), intended to accommodate families residing in danger homeless urban poor families needing resettlement assistance under RA 7279.The aforesaid Project was awarded to Richmark Construction,(TIN for the amount of Resettlement Project (now known as Catbalogan Highlands Subdivision located at housing project of the National Housing Authority (NHA and the City Government of Catbalogan. under the NHA's Resettlement Assistance Program for the Local areas and those affected by infrastructure projects of the City. and other qualified Brgy.San Andres.now,Brgy.Lagundi.Catbalogan City,Samar,is a joint socialized Documents submitted show that the Land Development of Catbalogan

name of the City of Catbalogan.The Project shall generate Three Hundred Sixty 360 Project includes Earthworks, Road Works, Drainage Works. Water Works. Survey Project shall cover the development of some 2.7444 hectares. more or less, of the Catbalogan covered by Transfer Certificate of Title No. serviced lots. Catbalogan Resettlement Project dated June 24,2014,the scope of works under thc 8.5517 hectare property described as Lot No. 2060 of the Cadastral Survey of Works and Miscellaneous Works.Per NHA Memorandum dated July 23.2013,the Moreover, based on the Contract for Catbalogan Highlands Subdivision registered under the

In reply.please be informed that Section 20 of RA No.7279 provides:

Participating in Socialized Housing. "Sec. 20. Incentivesfor PrivateSector To encourage

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Page 2 of 2 Richmark ConstructionCatbalogan Resenlemem PRoject

the underprivileged and homeless, the following incentives shall he extended to the private sector. greater private sector participation in socialized housing and further reduce the cost of housing units for the benefit of

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(d) Exemption from the payment of the following:

Project-related income taxes.

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3 Value-added tax for the project contractor

concerned."

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housing" as follows: Section 3 r of R.A. 7279 defines socialized

"(r)"Socialized housing"refers to housing programs and terms on interest payments,and such other benefits in accordance with the provisions of this Act:" (Underscoring supplied) projects covering houses and lots or homelots onty sector for the underprivileged and homeless development. long-term financing, liberalized undertaken by the Government or theprivate citizens which shall include sites and services

program must cover houses and lots or homelots for the benefit of the underprivileged is just a component of the main socialized housing project, without which, the project and homeless citizens.A purely land development project without the construction of houses and lots or development of homelots cannot avail of the tax exemption since it cannot be categorized as a socialized housing under Section 3 of R.A.7279 It is to be noted that in order for the above tax exemption to apply, the housing

legal basis. In view thereof. your request for tax exemption cannot be granted for lack of

Very truly yours.

K-1-JHB Commissioner of Internal Revenue KIM S.JACINTO-HENARES 042394 JUN 2 7 2016