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By Chino S. Leyco, Reporter
THE Department of Finance has cautioned the
Board of Investments (BOI) against approving tax and other
incentives for sham mass-housing projects.
A Finance department official said the BOI
should desist from granting tax incentives to condominium projects
as this result in more government revenues lost.
The Arroyo administration is hard-pressed
scrounging for revenues to finance its plan to jack up spending
aimed at cushioning the impact of high inflation and economic
slowdown. It earlier decided to put off to 2010 a plan to balance
its budget this year in light of the higher public expenditure
requirements.
Trade Secretary Peter B. Favila, who also chairs
the BOI, said last week the agency decided to extend the granting of
tax perks to mass housing projects. The Trade secretary said the
extension would encourage more real estate developers to develop new
and innovative housing technologies.
The Finance department, however, wants to plug
the loopholes in the government’s grant of tax incentives to mass
housing projects. It wants BOI to address the gray areas and craft
clear guidelines to ensure that only projects that fall under the
mass-housing category receive incentives.
Mass-housing projects are those with a per-unit
price of P300,000 and below.
The BOI earlier approved the incentives for
projects such as the multimillion-peso low-cost mass housing venture
of DMCI-Project Developers Inc. in Taguig City as well as a
high-rise residential building deal in Mandaluyong City.
Eton Properties Philippines Inc. of Lucio Tan
also secured tax perks for its two low-cost housing projects in
Metro Manila. Eton is spending P1.09 billion for the development of
One Archers Place in Taft Avenue, Manila and Eton Emerald Lofts in
Ortigas Center.
Trade Undersecretary Elmer C. Hernandez, who is
BOI managing head, earlier said mass housing is under review in line
with the directive of the Housing and Urban Development Coordinating
Council (HUDCC).
Hernandez said the BOI is predisposed to
granting the same incentives under the 2008 Investment Priorities
Plan only to those projects that would effectively address the
housing backlog.
This move came in the wake of a surge in
mass-housing projects that met the P3 million and below ceiling, but
yet failed to address the housing needs of the low-income bracket.
According to the Medium Term Philippine
Development Plan 2004-2010, the country’s population will need at
least 3.756 million units of housing, while the government’s
housing target for the period is set at 1.145 million units.
Hernandez said the country would need 2,754
projects at an average of 426 units each to construct 1.2 million
low cost housing units.
Over the past two years, the BOI registered 97
mass housing projects with an equivalent capacity of 42,258 low cost
housing units, representing 32 percent of the 133,183 units
constructed for the period.
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