VAT Ruling No. 087-02

November 29, 2002 VAT RULING NO. 087-02 R.A. 7279-Sec. 20 037-96 National Housing Authority Quezon Memorial Circle, Elliptical Road Diliman, Quezon City Attention: Mr. Felicisimo F. Lazarte, Jr. Department Manager Gentlemen : This refers to your letter dated May 27, 2002, on behalf of your private contractor, ACEC Builders , requesting for an exemption from the payment of value-added tax (VAT) on the construction of the perimeter fence in the proposed Pleasant Hill Subdivision, City of San Jose del Monte, Bulacan, which is a socialized housing project intended to accommodate homeless families belonging to the low and middle income families per certification dated May 27, 2002, issued by your Office. In reply, please be informed that Section 20 of Republic Act No. 7279 provides, thus: "Sec. 20. Incentives for Private Sector Participating in Socialized Housing. To further encourage greater participation in socialized housing and further reduce the cost of housing units for the benefit of the underprivileged and homeless, the following incentives shall be extended to the private sector. xxx xxx xxx (d) Exemption from the payment of the following: xxx xxx xxx (3) Value-added tax for the project contractor concerned;" Accordingly, the construction of the perimeter fence in the proposed Pleasant Hill Subdivision, City of San Jose del Monte, Bulacan, to be undertaken by ACEC Builders shall be exempt from the VAT. However, the purchases of goods/services by ACEC Builders shall still be subject to the VAT even if said purchases are to be used for the said project. This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation it will be disclosed that the facts are different, then this ruling shall be considered null and void. Very truly yours, (SGD.) EDMUNDO P. GUEVARA Deputy Commissioner Legal & Inspection Group