"Owning a home is the single biggest dream of most Filipino families. It is for this reason the Constitution no less mandates government to make decent housing affordable to underprivileged families," Santiago said.
"Government should use all policies, including tax schemes, to give more meaning to this constitutional mandate," Santiago added.
At present, only the sale of houses and lots and other residential dwellings worth no more than P1 million, the sale of low-cost homes worth no more than P500,000, and the sale of socialized housing units worth no more than P180,000, are exempt from payment of the 10 percent VAT.
Under new rules being readied by the BIR, the VAT-exemption ceilings would be increased to P1.5 million for houses and lots and other residential dwellings, P750,000 for low-cost homes and P225,000 for socialized housing units.
"The cost of building suitable housing has gone up considerably over the years. It is only apt that the VAT-exemption ceilings are adjusted upward to reflect the higher cost and selling prices of habitable homes," Santiago pointed out.
Santiago expressed confidence the higher VAT-exemption ceilings would give the housing and construction industries a massive shot in the arm, which would then have a positive multiplier effect on the broader economy.
Government revenues lost as a result of the higher exemptions could easily be recovered from increased VAT collections on the anticipated brisker sales of construction materials and home furnishing that would be used to build more houses, the Catanduanes lawmaker pointed out.