RR No. 1-2024: Further amends Section 2, Sub-section 4.109-1(B)(p) of RR No. 4-2021, as amended by RR No. 8-2021, to implement the adjustment of the selling price threshold of the sale of house and lot, and other residential dwellings for Value-Added Tax exemption purposes

Key points

1. New threshold. The threshold rises to Php 3,600,000.00 from Php 3,199,200.00, based on 2023 Consumer Price Index (CPI) values published by the Philippine Statistics Authority (PSA), rounded up. The formula is Current Threshold x CPI (2023) / CPI (2021).
2. Revised proviso. Beginning January 1, 2021, the VAT exemption applies only to sale of real properties not primarily held for sale to customers or held for lease in the ordinary course of trade or business, and sale of real property used for socialized housing under RA No. 7279, as amended. It also applies to sale of house and lot and other residential dwellings priced not more than the adjusted amount.
3. Periodic adjustment. Every three (3) years after this, the amount is adjusted to its present value using the CPI published by the PSA.

Who is affected

• Sellers of house and lot and other residential dwellings
• Sellers of real property for socialized housing

Deadlines and effectivity

• New threshold takes effect beginning January 1, 2024
• Adjusted every three (3) years thereafter