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Government may nix tax breaks for vertical mass housing

By Ma. Elisa P. Osorio (The Philippine Star) Updated February 09, 2010 12:00 AM

MANILA, Philippines - The government is looking at removing the provision for giving tax breaks to vertical mass housing in Metro Manila in order to encourage more developments in surrounding provinces.

In an interview, a ranking government official who requested anonymity said that initially they did not want to include vertical mass housing in the 2010 proposed Investments Priorities Plan (IPP).

However, at the behest of the Housing and Urban Development Coordinating Council (HUDCC) they reconsidered their decision.

The destruction brought about by typhoons Ondoy and Pepeng last year left a void in the housing sector specifically in Metro Manila. The official said that there is a study that there is a need for 200,000 mass housing units because of the typhoons. In spite of this, the official said they are looking at encouraging developments outside Metro Manila and one way to do it is to remove the tax perks.

In case the incentive for vertical mass housing is approved, the official said this year will be the last time they will be providing incentives for vertical mass housing.

Earlier, Board of Investments (BOI) managing head Elmer C. Hernandez said that the proposed 2010 IPP includes more perks for cement, iron and steel manufacturers given the boom in the construction industry.

Hernandez said that they will be including cement production in the IPP although they are still considering if it will extend to the clinker to cement productions. In 2007, cement production was included in the IPP and the condition was that firms maintain 85 percent of their facilities.

“There is a strong demand to put up new capacities. There is an immediate need for cement,” Hernandez said. In fact, he noted that Eduardo Cojuangco’s Eagle Cement Plant in Bulacan will be operational in March. Earlier reports showed that the plant is expected to cost P6.73 billion and produce 1.08 million MT or 26.4 million bags of Portland cement.


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