Philippines Exempts Agri Facilities, Warehouses from Property Tax to Boost Investment

The Department of Agriculture (DA) and the Department of the Interior and Local Government (DILG) on Wednesday inked a joint memorandum circular (JMC) to implement the local property tax exemption on buildings, structures, warehouses utilized as storage for agricultural input and outputs. The JMC was signed by Agriculture Secretary Francisco Tiu Laurel Jr. and Interior and Local Government Secretary Juanito Victor Remulla during a ceremony at the DA headquarters in Quezon City. The DA-DILG circular operationalizes Section 12(b) of the Republic Act No. 11321 or Sagip Saka Act, which exempts qualified structures, buildings, and warehouses used for storing farm inputs and outputs from real property tax, provided their assessed value does not exceed P3 million. The JMC also strengthens the Executive Order No. 101, series of 2025, which directs the full implementation of the Sagip Saka Act through coordination across the government to deliver its benefits to farmers, fisherfolk, cooperatives, associations, and agricultural enterprises. In his remarks during the signing ceremony, Tiu Laurel said the DA-DILG JMC was aimed at lowering operating costs and encouraging greater investments in post-harvest infrastructure. The Agriculture chief those who own an eligible warehouse or structure could save up to P12,000 in real property taxes per year. “Any tax savings can be reinvested… what we are hoping here is enterprise development. We want small players to become big eventually,” Tiu Laurel said. "Storage facilities are critical components of agricultural development. They help reduce post-harvest losses, preserve product quality, improve inventory management, and support more efficient marketing and distribution of agricultural products," he added. The Agriculture chief said the JMC establishes a clear and uniform framework for implementing one of the law's key incentives. The JMC, in particular, outlines the requirements, procedures, and responsibilities of national agencies and local government units, giving qualified beneficiaries greater certainty in availing themselves of the tax exemption. The measure came as producers continue to grapple with elevated logistics and transport costs, making efficient storage increasingly vital to reducing waste and improving farm profitability. Tiu Laurel said tax savings can be redirected toward better farm inputs, modern storage systems, post-harvest facilities, equipment, technology adoption, and enterprise expansion, particularly for small farmers, fisherfolk, cooperatives, and agricultural enterprises. He said the success of the policy will ultimately depend on its effective implementation, urging local government units to work closely with the DA so qualified beneficiaries can readily access the incentive. The DA expects the circular to spur investments in storage infrastructure, strengthen agricultural value chains, reduce post-harvest losses, and improve the competitiveness of the country's food sector by lowering costs and boosting productivity across the farm-to-market chain. — BM, GMA News