CEBU CITY – One of the biggest real estate industry groups in the country welcomed the government’s decision to shelve a proposed increase in capital gains, donor’s, and estate taxes, following stronger-than-expected government revenues in the first quarter of this year.

REAL estate industry group A Better Real Estate Philippines led by president Anthony Gerard O. Leuterio welcomes the Marcos administration’s decision not to increase taxes on property-related transactions. (Contributed photo)  

The Department of Finance (DoF), through Secretary Ralph G. Recto, announced the withdrawal of the Government Revenues Optimization through Wealth Tax Harmonization (GROWTH) bill, which had sought to raise tax rates on property-related transactions from six percent to 10 percent between 2025 and 2030.

“The government is properly managing its finances, ensuring that public needs are met without burdening the citizenry with new taxes,” Recto said in a statement on Tuesday, April 29. “We will continue to strengthen non-tax revenue sources to meet our fiscal targets.”

The policy reversal was lauded by ABREP, a trade association representing brokers, developers, and allied professionals. 

They had earlier urged the government to prioritize fiscal audits and expenditure reform over new tax measures, warning that the proposed hikes could chill investment and squeeze middle-income households.

“Raising taxes is not the solution,” said ABREP President Anthony Gerard O. Leuterio. “The issue isn’t a lack of funds, but how those funds are managed. Without accountability, higher taxes risk punishing property owners and ordinary families.”

The draft GROWTH bill was part of the DoF’s broader strategy to raise up to P300 billion in additional revenues to support infrastructure, healthcare, and education initiatives. However, the plan quickly drew pushback from the private sector.

Business groups, including ABREP and the Management Association of the Philippines (MAP), opposed the proposed measure, citing inefficiencies in public agencies such as PhilHealth, ongoing underfunding of State hospitals, and a deteriorating standard of public services.

In a letter to President Ferdinand R. Marcos Jr., MAP called for a moratorium on new tax laws until a full review of public spending and fiscal leakage is completed.

“This is not a matter of rich versus poor,” ABREP said. “Middle-income families selling inherited property or transferring assets would be disproportionately impacted.”

In a separate letter to House Ways and Means Committee Chairman Albay Rep. Joey Salceda, Recto formally requested the withdrawal of proposed amendments to the Capital Markets Efficiency Promotion Act (CMEPA), which was initially intended to pave the way for the GROWTH bill.

“The Department respectfully requests to withdraw consideration thereof in view of the better-than-expected revenue performance during the first quarter of the year,” Recto said.

While the Marcos administration maintained its commitment to long-term fiscal consolidation, the recent decision signals a shift toward revenue-neutral strategies and a greater emphasis on structural reform over direct taxation.