Persons inheriting homes from deceased parents or relatives usually are overburdened by the estate tax which they could ill afford. Because of inability to pay the estate tax, some heirs are focused to sell their inherited property.
To grant them relief, Senate President Juan Ponce Enrile has filed a bill granting an estate tax exemption for a family home from P1 million to P10 milllion.
“The prevailing provisions of Republic Act 8424) or the Tax Reform Act of 1997), as amended, allow for the deduction from the gross estate an amount equivalent to the current fair market value of the decedent’s family home up to P1 million,” Enrile explained in Senate Bill 132.
“Despite the deduction, the increasing value of the family home nowadays and its inclusion in the computation of the estate tax contribute significantly to the amount to be paid by the surviving spouse.
“Given the increasing cost of living and coupled with other taxes exacted by the
government in the form of income tax, value-added tax and real property tax, among others, the proposed measure will give immediate relief to the decedent’s family by allowing them to spend the amount saved from the payment of estate tax on other basic necessities and priority needs of the bereaved family,” he said in a statement.
Enrile added the “bill also intends to lessen the pressure on the surviving spouse to sell their property to other interested parties instead of passing them on the next generation.”
Enrile’s bill asks Congress to amend Section 86 of RA 8424 by exempting homes with a fair market value not exceeding P10 million from the estate tax. Previous the value exempted from estate taxation amounted to only P1 million. –Daily Tribune
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