𝗘𝗦𝗧𝗔𝗧𝗘 𝗧𝗔𝗫 𝗔𝗕𝗢𝗟𝗜𝗧𝗜𝗢𝗡 𝗨𝗣𝗗𝗔𝗧𝗘: 𝗜𝗦 𝗧𝗛𝗘 𝟲% 𝗘𝗦𝗧𝗔𝗧𝗘 𝗧𝗔𝗫 𝗔𝗕𝗢𝗨𝗧 𝗧𝗢 𝗕𝗘 𝗥𝗘𝗠𝗢𝗩𝗘𝗗? 🏠⚖️
Many Filipino families are asking:
“Will estate tax be abolished already?”
This is an important issue because many inherited properties in the Philippines remain unsettled for years — sometimes even decades — because heirs cannot immediately pay estate tax, penalties, documentation expenses, and transfer costs.
At present, there are legislative proposals in Congress seeking to abolish the estate tax, including proposals such as House Bill No. 6553 and House Bill No. 6535, which aim to repeal the current 6% flat estate tax under the National Internal Revenue Code.
However, it is very important to clarify:
𝗘𝘀𝘁𝗮𝘁𝗲 𝘁𝗮𝘅 𝗮𝗯𝗼𝗹𝗶𝘁𝗶𝗼𝗻 𝗶𝘀 𝗻𝗼𝘁 𝘆𝗲𝘁 𝗮 𝗹𝗮𝘄.
It is still a pending legislative proposal and must still go through the proper process in Congress before it can become effective.
𝗪𝗛𝗔𝗧 𝗜𝗦 𝗧𝗛𝗘 𝗜𝗗𝗘𝗔 𝗕𝗘𝗛𝗜𝗡𝗗 𝗘𝗦𝗧𝗔𝗧𝗘 𝗧𝗔𝗫 𝗔𝗕𝗢𝗟𝗜𝗧𝗜𝗢𝗡?
The main idea is to remove the immediate tax burden on heirs when a family member dies.
Instead of taxing the estate upon death, the proposal seeks to shift the tax burden to the time when the inherited property is eventually sold.
In simple terms:
✅ No immediate estate tax upon death
✅ Easier transfer of inherited property to heirs
✅ Less pressure on grieving families
✅ More idle properties may be unlocked and returned to productive use
✅ Taxes may instead be collected when the property is sold through the usual transaction taxes
This is why some lawmakers describe the proposal as a shift from a “tax on death” to a “tax on transaction.”
𝗪𝗛𝗬 𝗔𝗥𝗘 𝗟𝗔𝗪𝗠𝗔𝗞𝗘𝗥𝗦 𝗣𝗨𝗦𝗛𝗜𝗡𝗚 𝗙𝗢𝗥 𝗧𝗛𝗜𝗦?
Supporters of estate tax abolition point to several practical reasons:
1️⃣ 𝗠𝗮𝗻𝘆 𝗵𝗲𝗶𝗿𝘀 𝗰𝗮𝗻𝗻𝗼𝘁 𝗮𝗳𝗳𝗼𝗿𝗱 𝘁𝗵𝗲 𝗶𝗺𝗺𝗲𝗱𝗶𝗮𝘁𝗲 𝗰𝗮𝘀𝗵 𝗼𝘂𝘁
Even if the family owns land, they may not have enough cash to pay estate tax and transfer expenses.
2️⃣ 𝗠𝗮𝗻𝘆 𝗽𝗿𝗼𝗽𝗲𝗿𝘁𝗶𝗲𝘀 𝗿𝗲𝗺𝗮𝗶𝗻 𝗶𝗱𝗹𝗲
Because titles are not transferred, many properties cannot be sold, developed, mortgaged, donated, or properly used.
3️⃣ 𝗙𝗮𝗺𝗶𝗹𝗶𝗲𝘀 𝗮𝗿𝗲 𝗼𝗳𝘁𝗲𝗻 𝗽𝗲𝗻𝗮𝗹𝗶𝘇𝗲𝗱 𝗳𝗼𝗿 𝗱𝗲𝗹𝗮𝘆
When estate tax is not settled on time, penalties, surcharge, and interest may accumulate.
4️⃣ 𝗜𝘁 𝗺𝗮𝘆 𝗵𝗲𝗹𝗽 𝘂𝗻𝗹𝗼𝗰𝗸 𝗲𝗰𝗼𝗻𝗼𝗺𝗶𝗰 𝘃𝗮𝗹𝘂𝗲
If heirs can transfer inherited assets more easily, more properties may return to the market, support development, and generate future tax collections through actual transactions.
𝗪𝗛𝗔𝗧 𝗔𝗕𝗢𝗨𝗧 𝗧𝗛𝗘 𝗘𝗦𝗧𝗔𝗧𝗘 𝗧𝗔𝗫 𝗔𝗠𝗡𝗘𝗦𝗧𝗬 𝗘𝗫𝗧𝗘𝗡𝗦𝗜𝗢𝗡?
While abolition is still being discussed, there is also a separate proposal to extend the Estate Tax Amnesty.
House Bill No. 6614 seeks to extend the estate tax amnesty period until December 31, 2028 and expand the coverage to estates of decedents who died on or before December 31, 2024.
This bill has already passed the House of Representatives on third and final reading and has been filed/transmitted in the Senate.
But again, based on available public information, heirs should still verify whether the extension has already become law before relying on it.
𝗪𝗛𝗔𝗧 𝗦𝗛𝗢𝗨𝗟𝗗 𝗛𝗘𝗜𝗥𝗦 𝗗𝗢 𝗡𝗢𝗪?
Do not wait blindly.
If your family has an inherited property, it is better to start checking the documents now:
✅ Certified true copy of title
✅ Tax declaration
✅ Death certificate of the registered owner
✅ Marriage certificate, if applicable
✅ Birth certificates of heirs
✅ Extrajudicial settlement or settlement documents
✅ Real property tax status
✅ BIR estate tax requirements
✅ Registry of Deeds transfer requirements
Even if the law changes later, families who already organized their documents will be in a better position to act.
𝗜𝗠𝗣𝗢𝗥𝗧𝗔𝗡𝗧 𝗥𝗘𝗔𝗟 𝗘𝗦𝗧𝗔𝗧𝗘 𝗥𝗘𝗠𝗜𝗡𝗗𝗘𝗥
For buyers, be careful when buying inherited property.
Before paying reservation money, earnest money, or full payment, check if:
✅ The registered owner is still alive
✅ If deceased, the estate has been settled
✅ Estate tax or amnesty requirements have been complied with
✅ The heirs have authority to sell
✅ There is an Extrajudicial Settlement or court settlement, if needed
✅ The title can actually be transferred
A good property deal can become a legal and transfer problem if estate issues are ignored.
𝗕𝗢𝗧𝗧𝗢𝗠 𝗟𝗜𝗡𝗘
Estate tax abolition is a promising proposal, but it is not yet final law.
Estate tax amnesty extension is also moving forward, but families should verify the latest status with the BIR, Congress, Senate, or their legal/tax adviser before making decisions.
For now, the safest move is this:
𝗢𝗿𝗴𝗮𝗻𝗶𝘇𝗲 𝘆𝗼𝘂𝗿 𝗱𝗼𝗰𝘂𝗺𝗲𝗻𝘁𝘀.
𝗞𝗻𝗼𝘄 𝘁𝗵𝗲 𝘆𝗲𝗮𝗿 𝗼𝗳 𝗱𝗲𝗮𝘁𝗵.
𝗖𝗵𝗲𝗰𝗸 𝘁𝗵𝗲 𝘁𝗶𝘁𝗹𝗲.
𝗖𝗼𝗻𝘀𝘂𝗹𝘁 𝘁𝗵𝗲 𝗽𝗿𝗼𝗽𝗲𝗿 𝗽𝗿𝗼𝗳𝗲𝘀𝘀𝗶𝗼𝗻𝗮𝗹𝘀.
𝗗𝗼 𝗻𝗼𝘁 𝘄𝗮𝗶𝘁 𝘂𝗻𝘁𝗶𝗹 𝘁𝗵𝗲 𝗯𝘂𝘆𝗲𝗿 𝗶𝘀 𝗮𝗹𝗿𝗲𝗮𝗱𝘆 𝘁𝗵𝗲𝗿𝗲.
👍 𝗟𝗜𝗞𝗘, 𝗙𝗢𝗟𝗟𝗢𝗪 & 𝗦𝗛𝗔𝗥𝗘 for regular real estate tips, property due diligence reminders, buyer protection updates, and practical guidance for property owners, buyers, sellers, heirs, and investors.
For guidance and Q&A:
Samuel O. Lao
Licensed Real Estate Broker
PRC REBL No. 1368
Samuel O. Lao and Associates
Mobile/Viber/WhatsApp: 0917 323 6123
Sources reviewed:
Philippine News Agency report on House Bill No. 6553; House Bill No. 6535 filed in the House of Representatives; Department of Finance statement supporting House Bill No. 6614; ABS-CBN, BusinessWorld, and Inquirer reports on House approval of the estate tax amnesty extension bill; Senate legislative record for House Bill No. 6614.
Disclaimer:
This post is for general information and educational purposes only. It is not legal, tax, accounting, or financial advice. Estate tax rules, amnesty deadlines, documentary requirements, and transfer procedures may change depending on new laws, BIR regulations, and government issuances. Please verify with the BIR, Registry of Deeds, LGU Assessor/Treasurer, lawyer, accountant, or qualified tax professional before making any legal, tax, or real estate decision.
#SamuelOLao
#SOLARealEstate
#SamuelOLaoAndAssociates
#EstateTaxUpdate
#RealEstateTipsPH
#PropertyDueDiligence
