REVENUE MEMORANDUM CIRCULAR NO. 28-2013 issued on April 1, 2013 revokes BIR Ruling No. SH (044) 261-2008 pursuant to BIR Ruling No. 433-2012.

     In BIR Ruling No. SH (044) 261-2008 dated October 30, 2008, it was held that the National Housing Authority (NHA) is exempt from payment of Creditable Withholding Tax or Capital Gains Tax, whichever is applicable, on its sale of a parcel of land (commercial lot) to Wilbert S. Ramos. The NHA is likewise exempt from the payment of the Documentary Stamp Tax imposed under Section 196 of the Tax Code of 1997.

     However, in BIR Ruling No. 433-2012 dated June 25, 2012, it was ruled that the sale of commercial lot to Sy E. Him, Antonio Sy and Manuel Sy, although certified by the NHA as within its low cost housing project, is outside the definition of a “socialized housing” in relation to the tax incentives for the NHA under Section 19 of Republic Act (RA) No. 7279.

     Accordingly, applying Sections 3(r) and 19 or RA No. 7279, Section 27(D)(5) of the 1997 Tax Code, as amended by R.A. No. 9337 in connection with Sections 32(B)(7)(b), 196 of the same Code and BIR Ruling No. 433-2012, the sale of commercial lot, although certified by the NHA as within its low cost housing project, is nevertheless outside the definition of a “socialized housing” in relation to the tax incentives for the NHA under Section 19 of RA No. 7279, thus, subject to Capital Gains Tax and Documentary Stamp Tax.

     In view of the foregoing, BIR Ruling No. SH (044) 261-2008 has been revoked and all other existing rulings inconsistent with the provisions of this Circular are likewise considered revoked.