Liberalizing The Financing And Credit Terms For Low Cost Housing Projects Of Domestic Corporations And Partnerships

MALACAÑANG
M a n i l a

PRESIDENTIAL DECREE No. 745 July 15, 1975

LIBERALIZING THE FINANCING AND CREDIT TERMS FOR LOW COST HOUSING PROJECTS OF DOMESTIC CORPORATIONS AND PARTNERSHIPS

WHEREAS, the Philippine Constitution provides that the State shall establish, maintain and ensure adequate social services in the field of housing to guarantee the enjoyment of the people of a decent standard living;

WHEREAS, the housing problem of the country has grown into a critical magnitude requiring the immediate and concrete institution of measures which can meet the needs of Filipino families for decent dwellings;

WHEREAS, the need to resolve the housing problem therefore calls for a joint venture between the government and the private sector;

WHEREAS, it is incumbent upon the Government to harness and promote housing ventures in the terms of capital expenditures, land, expertise and financing including the provision for incentives and facilities to broaden the private sector participation in housing investment;

WHEREAS, there are domestic corporations and partnership which are willing or already have plans to provide housing...

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Summary of Presidential Decree No. 745

Liberalizing Financing and Credit Terms for Low-Cost Housing Projects
- The Government Service Insurance System (GSIS) and Social Security System (SSS) shall undertake measures to liberalize financing and credit terms for low-cost housing projects proposed by domestic corporations and partnerships with at least 300 employees or workers, organized under Philippine laws, and operating for profit, exclusively for their employees and workers. (Section 1)

Schemes for Liberalized Financing and Credit Terms:
• Low interest rates. (Section 1a)
• Lengthening of repayment period. (Section 1b)
• Adoption of graduated amortization scheme with smaller amortizations paid during initial repayment period. (Section 1c)
• Government subsidy of a portion of the interest payment. (Section 1d)

Profit Margin and Tax Exemptions:
• Domestic corporations or partnerships investing in housing for their employees and workers shall be allowed a reasonable profit margin if lots and dwelling units are sold or leased to employees and workers on easy installment terms or monthly rental basis. (Section 2)
• Tax exemptions shall be granted on: (Section 3)
- Real estate taxes on improvements used exclusively for housing employees and workers.
- Taxes on income derived from installment sales of houses or rentals to employees and workers.

Repealing Clause and Effectivity:
• All laws, orders, decrees, rules, and regulations inconsistent with this decree are repealed or modified accordingly. (Section 4)
• This decree shall take effect immediately. (Section 5)