The Philippine government is considering a new law that could raise the Capital Gains Tax (CGT) on the sale of real property from the current 6% to 10%. This adjustment is part of a broader tax reform effort led by the Department of Finance (DOF), aiming to boost government revenues and make the tax system more equitable.
This proposed change falls under the Passive Income and Financial Intermediary Taxation Act (PIFITA), which is still being discussed in Congress. If approved, the increase would apply temporarily, from 2025 to 2030, before reverting to 6% in 2031, unless Congress decides to extend it.
As of the date this article is published, the bill has not yet been passed into law. It still needs to go through further readings in both the House of Representatives and the Senate, and eventually be signed by the President.
The proposal has sparked debate among industry groups and property owners, with some expressing concern that it could affect real estate activity and place additional pressure on individuals selling their properties.
If you’re involved in buying or selling real estate, staying updated on this proposed tax change is crucial. Be sure to follow reliable news sources and official government announcements for the latest updates.
Capital Gains Tax (CGT) Deadline in the Philippines:
The Capital Gains Tax must be paid within 30 days from the date of notarization of the Deed of Sale or Deed of Exchange of the real property.
Important reminders:
This is counted calendar days, not business days.
The payment is made at the Bureau of Internal Revenue (BIR) where the property is located.
Along with CGT, you’ll usually also settle the Documentary Stamp Tax (DST) within 5 days from notarization.
