The Philippine government is taking a significant step to address the country's housing backlog by reviewing a key policy that could make building affordable homes more attractive to private developers.
Streamlining Tax Incentives for Housing
The Department of Human Settlements and Urban Development (DHSUD) is currently studying a proposal with the Department of Trade and Industry–Board of Investments (DTI-BOI). The review focuses on classifying economic housing projects as corporate income tax (CIT)-exempt mass housing under Batas Pambansa 220. This move is designed to accelerate the development of affordable homes and provide a more predictable incentive framework for the private sector.
Housing Secretary Jose Ramon Aliling explained that the initiative seeks to align the rules for economic housing more closely with those for socialized housing. He emphasized that a clear and orderly system is crucial for speeding up the response to the nation's housing needs and strengthening private sector confidence.
"We are aiming for a clear and orderly system for economic housing," Aliling stated. "When the rules are clear and implementation is fair, the response to housing needs becomes faster and the confidence of the private sector is strengthened."
Building on Recent Regulatory Reforms
This policy review follows recent actions by other government agencies to simplify processes for developers. The Department of Finance–Bureau of Internal Revenue issued Revenue Memorandum Order 048-2025, which introduced a more uniform process for tax exemption covering both socialized and economic housing. It also streamlined compliance procedures.
Earlier in 2025, the DHSUD and the Department of Economy, Planning, and Development issued Joint Memorandum Circular 2025-001. This circular adjusted the price ceiling for socialized housing projects under the government's flagship Expanded Pambansang Pabahay para sa Pilipino Program.
Secretary Aliling connected all these efforts, stating they are meant to sustain the vibrancy of the housing sector and to further speed up, streamline, and improve policies for the benefit of stakeholders, especially home buyers.
Next Steps and Broader Impact
To move the discussions forward with the DTI-BOI, Aliling has recommended forming a technical working group. This group would be tasked with conducting evaluations and drafting policy recommendations for inter-agency review.
The Housing Chief framed the initiative as more than just a tax issue. He highlighted its role in providing clear direction, building trust in government, and fostering collective action to meet the pressing need for affordable shelter for Filipino families, particularly working households.
"This is not just a tax issue," Aliling asserted. "It is about clear direction, trust in government, and collective action to address the need for affordable housing." The success of this review could lead to faster housing development, improved government coordination, and a more transparent incentive framework for projects that comply with BP 220 standards.
