The threshold amounts for value added tax (VAT) on sales and leases of residential lots and houses has been increased to offset the rise in the consumer price index by the Philippines’ Bureau of Internal Revenue (BIR).
According to the regulations if two or more adjacent residential lots are sold to one buyer, for the purpose of utilizing the lots as one residential lot, the sale will be exempt from VAT only if the aggregate value of the lots does not exceed PHP 1,919,500 and sales above those levels are subject to the 12% VAT rate. The VAT thresholds are made flexible to adjust movements in the consumer price index after every three years.
